Aug 29, 2012 | Innovation, Management
Innovation is not a marketing term, it is much wider than that, it is a mind-set.
It remains however, an eternal question, often used to open another boring workshop, “What is innovation?”
Usually those who ponder this question are the marketing bods, and the very senior management of an enterprise, but they do not usually do the work of innovation, their task is to create the environment where it can flourish. The work is done by hands on people, leveraging the resources made available to make change, and often working in quiet corners away from the scrutiny of the accountants.
So, again, What is innovation?
- Product, obviously, we change products all the time, occasionally it can be classed as innovation, but not often. The first iPod was an innovation, the second just a range extension.
- Business model. Ebay was a business model innovation that broke the mould for single item sales by individuals, as is the current move to cloud services from desktop applications.
- Business process. Old Henry made the best known process innovation when he adapted the production line from earlier examples, and applied it to automobiles.
- Perception of value to a user, demonstrated again by Apple, whose retail outlets are now the most successful retailers on a sales/sq meter basis in the world. Suddenly, bricks and mortar retailing has a place? Or is it a remake of the notion of how value is delivered that all retailers need to absorb.
Aug 28, 2012 | Customers, Management, Marketing, Sales
Most of the best ideas are simple, as is the Net promoter Score (NPS) the brainchild of Bain & Co executive Fred Reichheld.
As it gained currency, its simplicity became blurred by unnecessarily imposed complexity, often added it seems, just to make a consulting job seem more complicated.
NPS is really just one simple question:
“How likely are you, on a 1-10 scale to recommend this product/service to a friend or colleague”?
What Reichheld termed “detractors” answer 0-6, “Passives” answer 7 or 8, and “promoters” answer 9 & 10.
A company’s NPS is the percentage of Promoters minus the percentage of detractors. Simple.
The complexity comes often from the sample to whom you direct the question, and it is pretty easy to see how it can be “gamed” by those selections, which happens most often when some senior person reads about NPS, decides it makes sense, and just decrees to the sales force to go ask your customers, and that is exactly what they do, selectively. After all, their bonuses may depend on it.
Aug 21, 2012 | Customers, Management, retail, Sales
Without sales, all the rest of the stuff that goes on in an enterprise is irrelevant. All the lofty strategies, policies, and well intentioned platitudes are dependent on the delivery of sales for their oxygen.
As a senior manager in a large enterprise, I used to annoy, sometimes terminally, marketing personnel by insisting they all spend periods of time, particularly during the annual peak sales periods, out in the field, carrying a bag, talking to the retail personnel of our customers, and interacting with consumers in the retail space.
Most came back energised, engaged and motivated, some did not, and they usually found their career prospects better elsewhere pretty quickly.
Often other functional management also benefitted greatly from seeing how the product they made, counted, delivered, or engineered lived in the sales environment.
50 interactions with intelligent customers and consumers, and those who preferred our competitor products may not be a statistically significant sample, but you will learn more from those interactions than you will from reading expensive research reports behind a desk.
Aug 18, 2012 | Collaboration, Management
Management lessons abound in the great win by Australia’s K4 crew in London.
- Co-ordination maximises the effect of input. For 1000 meters, the crew was absolutely co-ordinated, any minor deviation by any individual would have had a profound impact on the performance of the whole.
- Focus. Just watch the faces during the race, (if you can find a video, I can’t) focused is an apt description.
- The power of a team is greater than the individual power of its participants. The four here are no doubt amongst the best, and fittest of athletes in the competition, but it is highly unlikely they are the four fittest and best individually, they have combined beautifully to make the best team.
- Visualising the result. Each of the individuals trained enormously hard when not together, and they trained as a team very hard, but each time they did a training run over the Olympic distance, according to one of the interviews I heard, they did it as if it was the Olympic final, so when it came to the real thing, they had already done it thousands of times.
- When faced with disappointment, as several were in Beijing, instead of throwing in the towel, they analysed what went wrong, and set about fixing the problems.
- Control what you can control, and do not stress about what you cannot. The Aussies had a race plan that they executed, knowing what they had to do to win, but during the race, their focus was on their own performance, not that of their opposition. It was only after the line was crossed that they were sure the gold was theirs.
- Planning a support processes are vital. The four in the boat were only a part of the team that made the win possible. The short race was the culmination of years of planning, training, and refining, a classic continuous improvement case study.
Aug 16, 2012 | Branding, Innovation, Management, Marketing
The decades of growth up till a couple of years ago, and the recognition of the key nature of a robust marketing input to corporate success has left many organisations, particularly brand heavy consumer organisations with a marketing overhead problem as times change.
They have a structure that is often 5 layers from the CMO to the assistant brand manager, organised along brand lines, and recently supplemented with category analysts, social media experts, and other service roles. All this at a time when consumer brands are under huge threat from retailer owned brands, global marketing, fragile demand, the erosion of the ability to differentiate by the ubiquity of information, and agile low cost competitors.
Just getting rid of every third head makes little sense, all you do is lose corporate memory, so you need to reorganise to deliver productivity from the investment in marketing overhead, although inevitably there will be personnel losses. Three questions to consider:
- Is marketing activity aligned to corporate priorities?. Many times I have seen lower levels in marketing departments beavering away at projects that bear little resemblance to the strategic priorities held in the corner office.
- Are project portfolios run alongside brand initiatives to ensure that the silos that evolve when brand groups are relatively autonomous are removed?.
- Have you made the hard choices about what projects will proceed, and which will be relegated to the car-park?. This is sometimes very hard, but is a crucial circuit breaker for innovation, with the caveat that those projects left are appropriately resourced.
This is not easy stuff, and most fail the test, which results in sub-optimal resource allocation decisions.
Aug 14, 2012 | Innovation, Management
Just as we manufacture antibodies in our blood to combat infection, so do enterprises construct antibodies in their cultures to combat risk, change, and therefore innovation.
This antibody construction normally happens by default, after all, why change things that have given us what we have? (This resistance to change when all is well is why the best time to change anything is when the poo poo has really hit the fan).
The management task is to administer the innovation drug to enterprises in order to change the culture that exists to enable innovation to occur.
Here is a list of innovation antibodies I have seen at their deadly work, in no particular order:
Ego
Hubris
Disciplined processes replacing thought
Old habits
“NIH”
Not listening
Concentration on narrow data sets
Happy to be a follower
Group-think
Believing managers are innovators
Weeding out the deviates, outliers and heretics
Ambition trumping capability
Rampant self interest
Believing the old adage that information is power, and holding it all close
Ignoring what is happening on the fringes of a market and technology
Not understanding who the customer is
Not listening to demanding customers
Not understanding why you are losing customers
Believing doing something well is good enough, instead of it being the price of entry
Failing to make intuitive connections
Believing the financial statements tell you all you need to know
Autocracy and fear as a management tool
Non investment in the intangible assets of a business
The list just seems to go on and on…………….
