I recently stumbled onto an analysis published last summer, and I re-read it. Had I read it more closely at the time, I might have changed my stock portfolio, but apparently it didn’t resonate with me as significant at the time. It certainly does now, because it leaps directly from the business pages of our newspapers every morning.
These days, the only thing more unpredictable than the weather is the state of the economy. Banking, insurance, housing, airlines and travel, autos, and heavy manufacturing are all in deep trouble as capital markets crash, credit tightens and consumer spending plunges and unemployment rises. Even darlings of the internet like Yahoo are struggling for survival as challenges swirl.
And yet, yesterday HP announced a healthy profit, beating last year’s performance, and posted a positive outlook for next quarter. Both Southwest and Netflix also delivered performance that beat analyst’s estimates.
So what goes? How is it that some businesses manage to survive, while many of their competitors and peers struggle --- or even totter on the brink of disaster? Smarter minds attribute it to not only management, but a new logic of competition itself.
First, high-performing companies understand that it’s not enough to be “pretty good at everything” anymore. An enterprise must be the “most of something”: the most exclusive, the most affordable, the most responsive, the most friendly. When I was in business school in the late sixties, we were taught to be focused on positioning companies in the in the middle of the road—because that’s where all the customers were. But now, in an age of hyper-competition, micro-markets, and non-stop innovation, you’ll surely be run over if you are in the middle of the road. Just look at General Motors today, begging before congress for another chance to survive. With or without a bail out, I don’t know. They are firmly stuck in the middle of the road.
Second, high-performance companies understand that in an era of great turmoil, the best strategy is to stick with what you believe in…and are already good at. On the surface, this concept almost seems in conflict with the first point, because “business thinkers” love to criticize corporations for resisting change. Truth in fact, the problem with big companies is that all they do is change. They lurch from one “Blue Ocean” idea to the next, shoveling wheelbarrows of cash from one consulting firm to the next in an effort to “re-invent themselves” when in reality they need to focus on the basics and become better at what they do best already.
Legendary management guru Jim Collins puts it best: “The signature of mediocrity is not an unwillingness to change. The signature of mediocrity is chronic inconsistency.”
There’s a third element that helps to explain extraordinary performance in these extraordinarily difficult times. Each of these companies connects with its customers based not just on price and features, but on identity and emotion. They have become virtually irreplaceable in the eyes of their customers. Can your customers live without you? Because if they can, they probably will.
The current business turbulence will undoubtedly cause most companies to seek a “correction” in their strategy. Make sure yours starts at the roots---with your customers---and not at the top with the latest “board initiative of the week.”
“Success usually comes to those who are too busy to be looking for it."
- Henry David Thoreau, author
I speak to groups from time to time, and am constantly striving to “dial in” improvements in my speaking style and execution. Recently, Harvard Business Review published a short piece called “How to Become an Authentic Speaker” by Nick Morgan. Some of his key ideas struck a chord with me. Let me share them with you.
Be Open to Your Audience: Practice your speech by envisioning what it would be like to give your presentation to someone you are completely comfortable with. The person could be your spouse, a close friend, or a business associate. Take note of what this feels like, and try to replicate that emotional state when you deliver the speech. (In a way, it’s similar to the old saying to “imagine you audience in their underwear.”) This posture leads to more natural body language, such as smiles and relaxed shoulders. And the behaviors in turn lead naturally toward more candid expression of your thoughts and feelings.
Connecting with Your Audience As you practice your speech, think about the concept of engaging directly with your listeners. Imagine that a young child you know well isn’t heeding your directions. You want to capture—and keep—his attention however you can. In such situations, you don’t strategize; you simply do what feels natural and appropriate. For example, you increase the intensity or volume of your voice or move closer to your listener. During your actual speech, these behaviors will happen naturally and with the right timing.
Being Passionate about Your Topic While rehearsing, ask yourself what in your topic you feel most deeply about. What is at stake in your topic? What results do you want your presentation to produce? Focus not on what you want to say but on why you’re giving the speech and how you feel about it. Let the underlying emotion come out in every word you deliver during rehearsal. You’ll infuse the actual speech with some of that passion and come across as more human and engaging.
Listening to Your Audience To practice this, think about what your listeners might likely be feeling when you step up to begin your presentation. Are they excited about the future? Worried about bad news? As you practice, imagine watching them closely, looking for physical signs of their response to you. During your presentation, then, you’ll be more prepared to identify the emotions your listeners are sending to you via nonverbal means. And you’ll be able to respond to them appropriately. Things such as picking up the pace, varying your language, asking an impromptu question, or even eliminating or changing parts of your talk.
Public speaking is never easy. But practice can make perfect; and there is no such thing as too much practice, so don’t short-change your preparation. And when possible, speak from an outline, not a script. Following these few tips will deliver noticeable results. Trust me.
Why doesn't the fellow who says, "I'm no speechmaker," let it go at that instead of giving a demonstration? ~Kin Hubbard
QSR Magazine published a Mintel white paper “Five Major Ways Consumers Will Adapt and Make the Best of Next Year.” I felt it proposed some interesting ideas, so what follows is a condensed version of the report. A link to the full report follows this post.
As a backlash against the fast pace of the modern world, people will try to take greater control of their lives and find pleasure in the simple things. Faced with financial insecurity, shoppers will seek out businesses and products they feel they can trust. And although they will cut back on spending, people will continue to treat themselves to little luxuries and fun activities.
1. You are in CONTROL
Over the years, people have become more confident and demanding about how they live their lives and spend their money. Consumers will seek out products and services that give them exactly what they want, when they want it, especially as their budgets tighten. And the Internet will play a key role in that effort.
Implications: Manufacturers must respond with products that suit people's specific needs and lifestyles. Those companies that give consumers precisely what they want or give them the freedom to customize their purchases will do well. In addition, Baby Boomers will still be of particular interest to businesses. Companies will move beyond traditional "old age" products and services to ones that embrace the active, healthy lifestyles of many older consumers.
2. Simplify and purify
Faced with fast-paced modern life, many people will seek convenience and simplicity. They will also demand that companies communicate with them honestly and openly. From understandable ingredients to clear company practices, consumers will want complete transparency when it comes to the products they buy. Old-fashioned skills such as cooking at home, sewing and gardening will become increasingly popular.
Implications: As consumers look for more authentic, easy-to-understand products, companies should seek to market their brands in a simpler, more direct way. Fresh…clean…sustainable …and natural will become essential values for consumers. And as people "cocoon at home” to save money and simplify their lives, companies will create products that address dining, relaxing and entertaining at home.
3. Rebuilding trust
Today's consumers have high standards and will demand value as well as consistently high levels of quality, safety and service. Crumbling economic markets, food scares and toy safety problems have fueled an era of doubt and insecurity, so people will seek out trusting, open relationships wherever they can. Winners will be long-standing, nostalgic brands with sense of familiarity.
Implications: Manufacturers will need to back up their words with actions and conduct business in a more open, honest way. Reassuring consumers that they are acting in the customers' best interest will become a primary concern for businesses. Also, as companies see shoppers sticking to already-familiar products, long-standing brands will move into new markets to exploit their position as trustworthy companies.
4. Trading down
As purse strings tighten, consumers will look for every possible way to make their pennies stretch further. Shoppers will mostly trade down to budget-friendly solutions to save money. But occasional indulgence in small, affordable luxuries --- like premium chocolate, designer sunglasses or a favorite premium moisturizer.
Implications: As consumers split between the low and high end of the market, manufacturers will invariably follow suit. Many companies will start to focus on value brands, but there will still be room for products that bring quality and perhaps a little luxury to the everyday. "The middle market will increasingly be squeezed and is going to have to prove its worth when faced with competition from newly improved basic lines. " For example, expect premium ready meals that give a restaurant experience at home, or beauty products that bring a spa-like feel to the bathroom.
5. Playfulness, lightening the mood
In tougher times, people need to enjoy themselves occasionally. Small playful distractions such as neon make-up, fun-to-eat food or interactive stores like Apple will become increasingly popular as people look to let their hair down and have some fun.
Implications: Companies will focus on products and experiences that are light-hearted, while those that offer real entertainment will have a significant competitive advantage. Beyond this, manufacturers will launch products specifically designed to enhance people's moods in unique ways. From food and beauty to household cleaners, expect to see a widening range of products that soothe, energize, or simply lift the spirits.
Kelley Robertson, a Canadian business consultant, recently wrote in the Sales Power blog about a study that uncovered “reasons your customers dislike salespeople.” The top ones include:
1. Not listening. This is the single most commonly cited issue in the survey. One of my bosses once told me that the perfect salesperson had “large ears and a tiny mouth.” When we don’t listen to our clients, we often fail to uncover their key issues and “unmet needs”. Furthermore, when meeting personally with a prospect, you also need to have “big eyes” and closely watch their body language for feedback on their acceptance, skepticism, or rejection of your narrative.
2. Talking too much. It still amazes me how many salespeople think that “telling is selling”. I’ve even seen this terminology cited in articles and blogs on selling. Ridiculous. Your prospect should do most of the talking during a sales conversation. It’s a lot like a top-notch radio interview (like Terry Gross, for example) where the interviewer feeds back questions based on the interviewee’s comments. You can still manage and control the sales interview with your questions, bringing out points that you can expand on once your prospect has revealed his key issues. It is definitely a talent that must be developed, so tie it with “listening” and control your discussion appropriately.
3. Lack of knowledge. In today's information-rich world, there is no reason for a salesperson to lack knowledge about the products and services they sell. In addition, a natural confidence comes with the assurance that you are an expert on your product and company. And understand that training is a PROCESS, not an EVENT, so make sure that your company makes the appropriate investment of time and budget to assure that all those involved in the sales chain are armed with the best information about your products features, benefits, and attributes, and are CONTINUOUSLY learning.
4. Lack of follow-up. This is a personal pet peeve of mine. Nothing says “unprofessional” louder than lack of proper follow-up. Today’s communication tools give us every opportunity to keep our prospects “in the loop” regarding an issue you promised to follow-up on. If you do not have the answer to their issue by the time promised, send them a SHORT courtesy update promising a revised date for the information. Regardless, most prospects use follow-up as a barometer of how they will be treated if they become a client, so ALWAYS under-promise and over-deliver when making claims. Perception can become reality...
5. Lying. Believe it or not, there are still salespeople who will say anything to “get the sale”. You have probably encountered them when buying a car or an expensive electronics item from a mass merchandiser. Most industries are getting better at weeding out these unethical types. Make sure you do likewise with your team. Not only is lying unethical, but the simplest of Google research will often confirm the untruth, guaranteeing that you will not only lose the sale, but the reputation of your organization and brand will be negatively affected as well.
6. Failing to understand a prospect’s needs. This is an extension of the first two reasons customers dislike salespeople. When a sales rep talks too much and listens too little, they don't get a full understanding of their situation, and the key issues they need to resolve.
7. Refusal to take "no" for an answer. Persistence should be a salesperson’s middle name, but there is a distinct difference between persistence and stalking! Nuance is the key; while you shouldn’t pack up and disappear at the first “no”, it is critical to respond to that “no” with a logical and complete answer to the client’s objection. At a certain point, however, the continued rejection of your argument becomes obvious, and the right move is to gracefully withdraw and regroup. Try to leave the door open for another discussion if certain issues are overcome or if a prospect’s needs shift. Try to think of “no” as “at another time under slightly different conditions”…some of which you control.
Continuous learning drives everyone to find a better way, every day. It’s not an expense; it’s an investment in continuous renewal. --Jack Welch, former Chairman and CEO of GE
Jim Sullivan has been a close friend and mentor to me for more than a decade. I always enjoy his view on life, music, and this crazy thing we all know as foodservice. I must recommend his column in this week’s NRN on “The ABC’s of Succeeding in a Downturn Economy.” (link below)
“A reputation once broken may possible be repaired, but the world will always keep its eye on the spot where the crack was.” --- Jim Sullivan, Sullivision
A productivity blog I subscribe to talked the other day about STUPID TIME.
No kidding. It’s things like jumping to Outlook every time you hear your computer chime that a new email has arrived… clicking on joke links in emails from your friends…You Tube…reading blogs (except for this one of course)…checking the stock market every 20 minutes…You Tube (yeah, I know I said it twice)…you get the idea.
It’s also when you're too tired to work strategically, but don't give yourself permission to quit. Instead of resting or doing something fun, you linger over emails, pour hours into minor matters, and just generally work in a way that's not productive or efficient. Don’t confuse “activity” with work. You are really burning STUPID TIME.
Now there’s nothing inherently wrong with STUPID TIME. Everybody should take some from time to time. Studies have repeatedly shown that taking short breaks from intense work actually can improve your productivity. It’s when those few moments turn into 45 minutes of watching all the cat videos on You Tube, or re-writing your to-do list for the fourth time today.
Your goal should be to MANAGE your stupid time. Go ahead and watch an episode of Family Guy on Hulu, but get back to work when the 22 minute episode is finished. Don’t rationalize that you should watch the NEXT episode now, and take a shorter lunch. Or better yet, get up and take a walk – outside. As my Mom used to say, “Go outside and get the stink blown off of you.” It’ll blow the stink out of your brain, too. I guarantee that your attitude toward that dull project or those follow-up calls will not only improve, but your productivity will too.
Gotta go…there is a new “hamsters for Obama” video on Funny or Die…
The secret of life is honesty and fair dealing. If you can fake that, you've got it made." -- Groucho Marx, American comedian
As most of you have noticed, I often reference (or adopt) articles of interest I see from the many daily feeds I receive. Today is no exception.
R&I published a study today by Booz & Company reporting that “...consumers plan further spending cuts as economy worsens.” That is certainly not a surprise. If you are like me and my family, virtually every purchase brings thoughts of your last brokerage statement to mind…
So, what does this mean in the larger sense of our businesses? Dining out is cited in this report (and anecdotally in numerous recent news reports) as a key discretionary item that has been impacted by the economic downturn.
The report details the impacts, and they aren’t pretty. As a manufacturer, what should you do to assist your customers in weathering this softness in traffic? (While keeping YOU in business!) At our family-owned sports tavern operation, we have initiated a few steps:
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Tuesday is now family night, with specials, including some “off the menu” kids specials. Our taverns have never focused on families, but the launch of our family night allows our regulars to suggest a night out to their families --- one that is NOT at a fast food joint, but somewhere that might be fun. We try to make it that way, with a family-friendly trivia contest, and drink specials for Mom and Dad. So far that has significantly improved our Tuesday business (typically a very slow night for us), and has provided a little incremental profit as well.
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Improved --- and heavily promoted --- takeout business. For those working in the neighborhood, they can either give us a takeout order when they are in for lunch, or fax it to us in the afternoon --- and we will have it ready to go for them as they leave work. We get a lot of business from a nearby hospital, so we are even exploring the transport of these meals to a central location at the hospital at the end of the workday. We require payment by credit card, so it’s literally ready to go. And we also par-cook the food and package it in ovenable containers so it can easily be reheated at home. This seemingly simple little step has helped us offset the loss of after-work traffic of late.
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I explained in a previous blog that we polled our customers and they told us NOT to alter our recipes or reduce our portions in an effort to lower prices. However, we have developed value-centric off menu specials every day at lunch and dinner, for those who are interested in a less costly meal. We use our distributor rep to identify hot deals from suppliers to help us decide what to set up for our daily and weekly specials, and then order just enough to allow us to offer those items.
Getting the drift? Your mission (should you decide to accept it) should be to figure out how to help your chains and operators:
- Temporarily lower the cost of using your product
- Develop promotional ideas that will increase traffic AND sales
- Create Take Home and Take Out ideas to help fill the gap
Work closely with your distributors to make sure they are not taking the discounts to their bottom line, but passing them along in total. One way to do that would be to establish a direct-to-customer rebate program, but you had better have your TPM process buttoned up and pay it out quickly, with an effective auditing function. (That is a subject for another blog…)
Your non-commercial accounts need help also, but your programs here should focus on their unique needs (Traffic? Volume? Gross margin? Merchandising?) Now is NOT the time to reduce your spending on trade promotion, but to FOCUS its use where it can make a difference in these major accounts. (Again, do not increase it unless you have your TPM process properly structured, or you will negatively impact YOUR bottom line, which defeats the purpose!)
The coming months and quarters will be a challenge for the best of us. Don’t panic… get greedy (see the previous blog entry if you think I have overstepped my bounds).
We are continually faced by great opportunities brilliantly disguised as insoluble problems."
-- Lee Iacocca, American industrialist
Yesterday, Warren Buffet wrote an Op-Ed for the New York Times. In it he shared the simple rule he uses for investing, “Be fearful when others are greedy and greedy when others are fearful.”
Its simplicity is obvious when applied to the volatile stock market during these turbulent economic times. But it has application in other areas as well.
For example, think of your own commercial segment foodservice business. Many of your competitors are so fearful of what MIGHT happen that they have begun to corral their marketing and promotional support while they wait it out. This can provide a huge opportunity for YOU to gain market share, and cement relations with the accounts you may share with your competitors. Customers need MORE support now, not less. So give it to them.
Yes, I know that you are probably experiencing some of the same challenging cost issues as your competitor, but you still have product don’t you? Your plants are still in operation, aren’t they? Get out there and meet with customers, be aggressive, and be sensitive to their needs. Customers, likewise, have dialed back some of their expectations, so use that to your advantage to negotiate a stronger position with them, while gaining share during this downturn. Remember Sun Tsu: “The enemy will attack at the first sign that it senses fear.” Exude confidence and optimism in your dealings with customers, uncover their current needs, and present them with creative solutions. You’ll both be better off for it.
These next few months (years?) will not be easy on any of us. But when the economy begins to come back, your customers will respect your loyalty and return it in kind. Your business will return to health much more quickly, and your market share and brand strength will pay longer term dividends.
So in the context to today’s “market fear,” greed is good. Take it from Warren.
I recently saw some excerpts from a new book "Samurai Selling, The Ancient Art of Service in Sales," an interesting approach to selling based on the Samurai warriors of ancient Japan. In it, the authors define the samurai in this way: “The samurai was not a maniac with a sword; he was a man with a mission that could be summed up by the question, 'How can I best serve my client?'"
One of the more intriguing sections speaks to the need for “The Beginner’s Mind.” Eliminating the baggage of pre-conceived solutions and solution prejudice, one can always be ready to learn, eager to further develop technique, and willing to look at things through the changing perspectives of our clients. Summing up:
1. Keep an empty cup. "A beginner's mind keeps you open to creative solutions." Using the cup as a metaphor for the mind, if your “cup “ is full there is no place for new content -- anything added just runs off the side. The full cup is a symbol for someone who feels he already knows everything -- there's no room for new knowledge. An empty cup, conversely, can accept any and all ideas, increasing the possibilities of discovering tactics that will yield great results if we're willing to try them.
2. Don't get locked into technique. "If you become attached to one technique, you are an aging warrior, a full cup....Great artists master technique then transcend it; mediocre artists master technique and then become slaves to it!" Don't fear attempting new techniques and approaches to opportunities and challenges.
3. Be the Prospect. "See what he sees. Feel what he feels.... As you do this, you will begin to get ideas about how to serve him. This is a beginner's mind." While we should always develop our strategies with our clients needs in mind, we should also “become the prospect” and develop approaches that better match what's already on their minds.
At this point I can’t resist mentioning the great scene between Ty Webb and Danny Noonan from the movie Caddyshack:
TY (blindfolded, addressing a golf ball in front of a water hazard approximately 100 yards from the green): Danny. I'm going to give you a little advice. There's a force in the universe...(hits ball onto the green)...that makes things happen. All you have to do is get in touch with it. (hits another perfect shot) Stop thinking. Let things happen...and be...(hits another great green shot) the ball. Hand me the wedge. Find your center (hits another ball which bounces softly on the green and rolls into the cup.) Hear nothing. Feel nothing.
DANNY: That was kind of incredible, sir.
Using these three samurai tricks to clear your mind and become the customer sounds hokey…and maybe it is. But when it works, it’s like Danny said, “That was kind of incredible, sir.”
Be incredible.
If you are in charge of an organization --- or just a middle manager --- it’s been hard lately NOT to blow up at those around us as we deal with the stress of the economic crisis and pressures from our customers, our co-workers, and our family. If you are like me, you immediately regret it once it happens. But it happens anyway…
A hot temper can create a lot of destruction in a very short time…not unlike a tornado. In addition, if you are prone to blow ups, those around you may couch their comments rather than risk your wrath. When this happens, your associates may not provide all the information you need to properly manage your enterprise.
You can't stop the world from making you angry. If only! Controlling your temper, though, can be learned. A good example is golfer Tiger Woods. The following tips are adapted from one of his early coaches. He is certainly a living example that this process can work! So to keep your cool, try these three steps:
1. REACT. Feel and name the emotion while you take as many deep breaths as you need to help you let it go.
2. REFOCUS. Review what you are trying to accomplish, and what you need to do today to move it forward.
3. RE-ENGAGE. Connect with the situation by developing your own version of what Tiger Woods does after a bad shot: He goes through step 1 and 2, then stands up to the next one and says: "Execute."
If you try these tips and don't succeed right away, keep trying. In the meantime, you might want to master another art: the humble apology.
People who fly into a rage always make a bad landing. ~Will Rogers