How desperately does politics need a strategic makeover?

How desperately does politics need a strategic makeover?

Jul 27, 2016 | Change, Leadership

The train smash that doubled as the recent Australian  federal election, and more tellingly, the ‘cluster-intercourse’ (politeness overcame me) that is the US presidential race have something in common.

They both lack any sort of the foundations for prosperity that we demand, indeed, regulate for, in our corporations.

In a corporation, when you do  not deliver the results, shareholders move their money elsewhere. Not so in Government.

In a corporation, when the leadership fails to deliver promised results they  get fired. Not so in Government, although some do carry the can for the rest, usually on a Last In First Out basis.

In a  corporation, if you tell a lie to shareholders, you can go to gaol. Not so in government.

In a corporation, when you do  not adequately articulate a realistic and achievable financial plan, bankers will not lend you money. Not so in Government.

In a corporation, when there is a noisy minority mouthing nonsense, you ignore them, or make polite fun of  them. Not so in Government, indeed, it seems that the noisy minority often successfully drives the agenda.

How have we allowed this to happen, after all it is supposed to be a democracy, although sometimes I wonder, as who in their right mind would vote for any of the above.

A year ago, the notion that an ego driven billionaire with no experience in government, little affinity to anything beyond his own interests, and little apparent relationship with the truth would be the US President was a laughable prospect. Now he is one of two in a race to the finish.

No laughing matter anymore is it?

How has this happened?

It seems to me that Trump has succeeded wildly where the Liberal party in Australia failed.

He has mastered the tools of immediacy marketing, social media platforms, particularly Twitter, and leveraged the fact that our journalistic capacity has been so  gutted, along with the attention span of the electorate, that the capacity for sensible and measured comment and debate has been removed. Have you noticed that everything anyone on the Democratic party side says gets a Trump response, often an outrageous one, on twitter within 5 minutes. The media picks it up, and in the absence of anyone on the newsrooms not playing Pokemon Go, reprints it in entirety as news. Then a few huff and puff for 24 hours and it is  forgotten or replaced by the next piece of shambolic inconsistent nonsense. By contrast, the Democrats take a day or so when they are awake to comment on the next of Mr Trumps blatherings, and are not nearly as colourful and entertaining when they do so.

And I have not even mentioned Britain’s new Foreign Minister Boris Johnson, whose mastery of the entertaining absurd rivals that of Mr Trump.

The simple fact is that you do not get headlines with measured, thoughtful analysis of the facts, together with projections that are never favourable to everyone, but you do get headlines with sensational brain-farts that disappear almost as fast as they are produced.

Headlines are now news, there seems to be no demand for substance in excess of 140 characters.

However, that current state is no excuse for not trying. Without the effort to reform from the grass roots the way we select our leaders, and demand from them some level of quality in the political and economic debate, on top of a reasonable degree of integrity and transparency, we are all in deep doo-doo, and it is getting progressively deeper the longer we allow this to keep happening.

4 questions every business owner should ask themselves. Now.

4 questions every business owner should ask themselves. Now.

Jul 25, 2016 | Change, Governance, Leadership, Strategy

In principal, business is simple, sell something for more than it costs you too produce it. After that it gets more complicated, but is always tangled up with the word “Value”

It is a word with many meanings to different people in different contexts.

How do we create value?

Value, like beauty in the eye of the beholder, is in the eye of the user. Value means different things to different people in different circumstances, and figuring out how to add value to that customer under those circumstances is the secret sauce of success. The key to value identification is always to be able to see the offer you are making through the eyes of the customer.

How do we deliver value?

‘Value’ is only valuable when it delivers a benefit. If you have the only part in town that will fix a problem, that part only has value installed, it is no good in your toolbox.

The means by which you deliver value varies, and the business models available have exploded. Supermarkets have an entirely different model to a grocery home delivery service. While the products may be the same, and from time to time the customers the same, the circumstances under which they are used will never be he same.  AirbnB would not have been possible 10 years ago, two sided markets were simply too cumbersome except in capital intensive applications like a stock exchange. Similarly, the availability of digital versions of books, along with the spoken and traditional print versions deliver the value of a book in different ways.

How do we capture value?

Business is about getting paid for  the value delivery more than it cost you to provide it. Again, digital changed the game, just ask anyone in the newspaper business. Deep consideration of the most appropriate business model is required if you are to capture all the available value, and leave your customers happy enough  to go again.

Will it be the same tomorrow?

Almost certainly not.

And the day after tomorrow, there will have been substantial change. How you react to or better, anticipate the change will be the measure of how commercially sustainable your business really is.

One more really important thing to remember.

Businesses are inanimate collections of assets and processes that can do nothing by themselves. They need people to make them work, to create the environment that accommodates the four factors above. The old cliche of people being our most important asset has never been truer than in this current environment of accelerating change.

Is technology killing advertising, and ruining our lives?

Is technology killing advertising, and ruining our lives?

Jul 20, 2016 | Governance, Leadership, Marketing

A while ago I asked the question ‘Is the net killing marketing creativity‘ and came to the conclusion that the instant gratification now apparently demanded in all phases of our lives has indeed killed creativity.

Perhaps tritely I put it down to the not so bright amongst the marketing fraternity taking the easy way out, because it was the only one they could see.

However, the question does require some greater consideration.

That technology has overtaken us is indisputable, giving us the potential for focus and reach in addition to great  performance metrics, but creativity requires more than just speed. It requires subtlety, deep understanding of those with whom you are communicating, a capacity to see yourself through the eyes of others, and a willingness to be different and take risks.

It is in these latter areas that advertising is failing, badly.

For the uninitiated, ‘Martech’ seems to have caught on as the phrase of the moment, very intelligently pushed by my colleague Scott Brinker on the Chief Martech blog.

A subset of the Martech environment is the ‘Adtech’ tools, which have automated advertising, the most obvious but far from the only manifestation of creativity. Whether it  be on line or in an analogue environment, only the means of delivery has changed, not the need to engage, entice, intrigue and advise readers.

The ad industry has certainly been damaged, although great swathes of it have just got what they deserved, being mediocre purveyors of wasted investment, and unwilling to see the writing on the wall, although it was their wall.

The technology has been abused, and consumers have turned off it all, and the evidence for  that is everywhere.

Over 400 million people, 22% of smart phone owners use ad blockers to insulate themselves from advertising, and the number is currently higher on desk-top devices.

Web advertising has evolved quickly into the digital version of the crap that fills your letterbox, direct response, discount coupons, price promos, untargeted rubbish. Where is the recognition that advertising has a higher purpose, it is an investment in the long term, things called ‘brands’.

Remember them?

And as for advertisers, they are slowly waking up to the fact that up to 40% of their ads are being seen only by robots, and last I looked they do not buy much. In addition, the media placement is now often done by so called ‘programmatic buying’ which is a way of removing the insight and intuition of people from the process, saving money and pocketing the difference. While sellers tout the value of programmatic buying, and in some circumstances it does have merit, the major benefit is their pockets, not the advertisers marketing outcomes.

More fool the marketers I guess, they are getting what they deserve.

I will show my colors here, as little investigative reporting as we have come to know it being done in the digital space. Where would Australians be without people like Kate McClymont of Sydney’s SMH who almost single handedly, and against great odds provided the impetus that led to the conviction of Eddie Obeid for fraud, and exposed the predation of members of the Catholic church clergy in Newcastle that led to the current Royal Commission. Google and Facebook have no interest in this sort of journalism, paid for by advertising, and benefiting the society we live in.

As for consumers, we have had our privacy thrown against the digital wall. My kids seem less concerned than me, but nevertheless, I am bothered by the implications, as well as those bloody ads for stuff I do not want that follow me wherever I digitally go.

And as for the digital security of us all, when hackers find 138 holes in the pentagon web sites, good luck with the security of your google account.

9 point plan to create your business model

9 point plan to create your business model

Jul 18, 2016 | Governance, Management, Small business

One of the major things most small and medium businesses give little thought to, and which can have a major impact on their financial outcomes is their business model.

There has been much written over the years, huge volumes of academic and consultant driven tomes , full of jargon and long words. Mostly, the owners of small and medium sized businesses,  starved of time as they are, have not read or absorbed this stuff, and even if they have, the day to day struggle has taken over.

The options open to construct a business model vary with every business, and every set of circumstances. Trying to copy what somebody ese is doing will only go so far, the great value is in tailoring the elements to best suit your objectives,  resources and competitive circumstances.

Thinking about it in this business model framework can be enormously valuable.

Most recently, Alexander Osterwalder wrote a book called ‘Business Model Generation’ that outlined a framework that simplifies all thing you  need to think about, without the jargon.

That framework has 9 elements

Business model canvas

Customer segments. Any successful marketing is dependent on defining your primary customer segments. These days you can go further, and in my view need to go further for SME’s, to having a detailed customer persona, perhaps several of them, to better enable the direction of marketing communication directly to the needs of very finely defined customers.

Value proposition. Defining the value you add to your target market is fundamentally important. If you cannot articulate the value, why would you reasonably expect anybody else to understand it? Value comes in many forms, simplicity, performance, design, degree of customisation, risk reduction, and many more, including the default, Price. However, if you define your value proposition in terms of price, you have already lost.

Channels. How do you communicate with your customers and potential customers, and then deliver on your value proposition? This item is a combination of the logistics and operational side of the business,  with the marketing and sales sides.

Customer relationships. What type of relationship do you have, or want to have with customers, and how might they want to deal with you. Are they intimate and personal, or automated over the web, collaborative or purely transactional? The choices will be driven by the alignment with your value proposition and customers.

Revenue streams. No business can survive without revenue, it is perhaps the only constant of business as well as the public and non profit sectors. Determining the best way for you to be paid for the successful delivery of your value proposition to your customers is a major item in the model construction. Is it purely cash, or licencing, franchising, what sort of trading terms will apply, are you seeking recurrent income as for membership?. Obviously the price you charge is a major decision, but prices should be driven by the model, and your competitive profile, not by costs, or a guess.

Key resources.  Every business requires resources of many types to grease the wheels of the business model. Defining what they are and how they interact is really fundamental, as they are the enabler of the value proposition, and without alignment to the value proposition you will have sub optimal performance. The key resources can be physical, human, intellectual, financial, whatever is required to deliver on the value proposition.

Key activities. There will also be a few key activities. Things that simply have to be done to make the business model work. Production operations if you are a manufacturing business, problem solving if you are a consulting business, and stock management if you are a retailer. They make the rest possible.

Key partnerships. These are the networks of suppliers that make the business model work. Who they are, what they contribute to the value proposition, how they how yoou choose to interact with them all make a significant difference to the manner of business model performance.

Cost structures. Finally, what are the costs incurred to operate and sustain the business model, those that are fixed, those that are variable, and how they might swing between these two. What are the economies of scale and scope that may apply under different circumstances?

 

I have used this canvas, and some of the iterations that have evolved in workshops with medium sized businesses with considerable success.

What you realise  very quickly  is that there is no right answer, and no  easy path. There are cause and effect chains that operate across the board, changing one thing always has a string of impacts. The best way to manage all this and come to some actionable conclusions is with a directed brainstorm that records the ideas and cause and effect chains, followed  by an experiment or research of some type that involves real customers.

What I call “getting out of the building”

 

 

How to build a sales process for your human salesforce.

How to build a sales process for your human salesforce.

Jul 14, 2016 | Customers, Sales

These days great sales people, real ones, those that go and talk to customers and potential  customers are expensive, and hard to find.

Most often in a B2B environment their role is not just closing a sale but developing a relationship that is deeper and longer term than the individual  transaction. Success is measured not just by the transactions, but by the quality of the relationships they build, and the trust, that will take the pressure off price, delivery times, and the other quantitative measures used to judge performance from a distance.

It also true that the first time many sellers know a potential customer is in the market is after that customer has done a considerable amount of research, arrived at a short list, features required and price  point, which gives them the power in the conversation, unless you are able to re-frame it somehow.

The word ‘Process‘  in the headline implies repeatable, subject to continuous improvement, and measureable. In order to achieve these outcomes there are a number of building blocks:

Plan

The old cliché “failing to plan, is planning to fail’ is unfortunately true, that is why it is a cliché.  The caveat of course is that just planning will not generate an outcome, you actually have to implement. The gap between planning and implementation is deceptively wide and full of very hungry crocodiles  that will consume your will, time, and financial resources given the chance.

 

Don’t spend time, Invest it.

We demand a return  on our financial investments, why don’t we do the same for that most valuable of resources, our time? Most of us complete some sort of post capital expenditure review to check that the returns we expected and planned for prior to a capital investment actually materialised.

Why do we not do the same thing without most valuable resource, time?

This may be a challenging idea, but if you allocate your time to the ‘important but not urgent’ category rather than the seemingly urgent, but not important things that consume our lives, the returns will flow.

 

Learn continuously

Being able to learn is a gift, leverage it. Nobody becomes outstandingly good at something without learning from those who have gone before and mastered  the skills. Beyond a base level of skill, you need coaching to learn,  and it is the primary role of a sales manager to coach those in their team, so they learn, do better, effectively leveraging their time and expertise, learnt from those who went before, and their hard won experience.  A core part of learning is being able to be reflective about what worked and what did not, then making those small adjustments, day after day, to test and improve.

 

Be proactive

An old football coach of mine used to bang it into our heads that while defence was a critically important component of any contest, you did not win by preventing the other bloke from scoring, at best, it was a draw.

Being proactive is about experimenting, taking considered risks, searching for opportunities, prospecting for ideas and applications that others have missed, being unafraid of the power of the status quo, and being prepared to ask for forgiveness rather than waiting for permission.

My standard mantra is ‘get out of the building’ meaning nothing different or innovative happens within the context of your normal, routine activities.

 

Follow up obsessively

Few sales are made at the first contact, or second. It takes time and polite persistence mixed with an understanding of why the ‘target’ will benefit from buying from you. Failing to articulate the value of your proposition results in the follow up being Spam, but if the value is genuinely there, follow up builds credibility, and in a small way, a sense of reciprocity or obligation to at least give you the opportunity to make your pitch.

 

Remove ‘busywork’

We all know that work fills the time available, but we also know  that often the stuff being done is just ‘busywork’, stuff that rally makes little difference apart from reassuring yourself that you are needed, and others that you are indispensable. Remove it, ruthlessly, in favour of activity that customers would be prepared to pay for, because that is exactly what they are doing, indirectly.

 

Most of the real work is not digital

It has becomes to easy to rely in digital to do our jobs for us. It won’t, it can only do exactly as it is told. Besides, people buy from those they know like and trust, and I never met a computer I completely trusted, somehow they are not completely human.

 

As noted previously, the term ‘Sales’ is to my mind approaching redundant, as it conjured up in most people minds something less than what it is, or should be. The term I favour is Revenue Generation. This simple semantic change tends to shake perceptions and put the sales function into the spotlight as being vital, not just those people down the hall with company cars who go out to lunch a lot.