Aug 6, 2009 | Innovation, Management, Marketing, Sales
Every business has in some form a process for generating, qualifying, and allocating resources to sales leads. In many businesses, it is a very expensive, resource hungry exercise, so finding a way to short circuit the process, would be offer the potential for a major increase in productivity.
One Australian business, Cormack Packaging has evolved an Innovation Award over a number of years that is a collaboration between Cormack, and a number of universities offering design degrees. Cormack coordinates a competitive process judged by industry experts, that offers final year design students a project that carries a monetary prize, a commercial design assignment, and increasing prestige for those who do well, as well as royalties on anything that is commercialized. Cormack offers technical support, and access to its facilities to the students, providing valuable real world experience for the participants.
Importantly, for a modest investment, Cormack is creating a “bank” of ideas that address real world problems, and a forum for the ideas to be given a commercial airing. Apart from contributing to the “design gene pool” in a substantial manner, they are able to identify emerging design talent and harness it, as well as providing a reason for their customers and potential customers to shop with Cormack for solutions to their problems.
This is a massive short circuit of the lead generation and qualification processes their competitors engage in. How much better to engage with the decision-makers from existing and potential customers in a forum whose objective is the development of innovative solutions to a specific set of packaging challenges, rather than having reps cold call potential customers in an attempt to get an audience with someone who cares.
Aug 5, 2009 | Innovation, Management, Strategy
The usual interpretation of the function of the hemispheres of the brain is that left brain types become actuaries, and right brain types become artists. How then do you accommodate Albert Einstein, a great mathematician, and a great creative brain in one, Leonardo is another, we all know some, perhaps a bit less well known than those two.
Could it be that our accepted model is wrong? Perhaps left brain types are comfortable with the status quo, the way things are, whereas the right brain types are more likely to seek a different way of looking at things, are comfortable with ambiguity, and see things in ways others do not.
Innovation has at its core a restlessness with the status quo, and it is well accepted that “dissidents” in organizations are the ones who are the catalysts to change, they also suffer a higher than average corporate mortality rate, but without dissidents, nothing new gets done, so don’t just tolerate them, attract, encourage, and reward them.
Jul 27, 2009 | Management, OE, Operations
Operational management is becoming harder pressed to find reductions in the working capital required to keep the operations running, with the constant option of outsourcing, “off-shoring”, consolidation, and so on as the price of not running hard enough. Working capital numbers over time are a good measure of the cost awareness of your operation, but do not really address how productive the working capital is, for that you need a denominator in the equation.
Working capital is: Accounts recievable + inventories – accounts payable. If you add a denominator, you can get a measure of the productivity of your investment in working capital:
Working Capital Productivity= Working Capital/net sales. How much better to measure the productivity of the investment rather than just the amount of the investment.
Jul 24, 2009 | Management, Marketing, Sales, Strategy
The new conventional wisdom is to use the net as a marketing tool. I am certainly one who believes that the net is as influential as was the introduction of TV as a marketing medium, but the “rules” for brand building remain similar on the net as they have always been, just the emphasis, and degree of control of who receives the message is different. The focus of activity is now onto the individual, rather than a group of people who display some commonality.
The first and biggest challenge is to recruit visitors to your site, and gain their permission to engage with you, and this is getting harder by the day as the number of sites explodes, as does the sophistication of the strategies to attract users.
However, once you have a “user” to leverage the power of the net, you must:
Motivate consumers by using stories, have a narrative which individuals can use to guide their behavior, and that of their various groups of peers.
Engage with consumers individually, on some level, and facilitate connections amongst individuals who can relate to the narrative.
Leverage the power of the individual communication, by giving people something to do, a way to engage, a reason to buy.
Jul 22, 2009 | Demand chains, Management, Sales
Customer focused has become a cliché, it appears in a wide range of material, usually it seems, written by people who have never interacted with a customer in their lives.
So how do you measure customer focused? Here are some basic things you need to know before the expression will be more than a cliché:
- We know the characteristics of a loyal customer, not just the social economic, but the behavioral drivers they experience
- We understand the relative value of our value proposition to different types of customers.
- We measure customer profitability over more than just one, or one periods transactions.
- We know why we lose customers, and actively manage the loss of unprofitable customers.
- We know how much it costs to attract, and retain profitable customers.
- We know where we sit on a customers “value curve” the trade-off customers make between the relative cost and utility of our products, Vs the opposition.
- We set out to measure the “advocacy” of our customers for our products.
- We collect data from non customers who use opposition products, and we understand them, and the attraction of the oppositions offer Vs ours.
- Everyone in the firm recognises that it is not just sales people who have the responsability to serve customers, but everyone in the firm has a role in providing that service, from the CEO to the cleaner, and they all rely on continued customer support for their employment.
When you are well advanced in all of the above, you will be reasonably able to call yourselves “customer focussed”
Jul 21, 2009 | Management, Marketing, Strategy
Yesterday Telstra, Australia’s largest, formerly monopoly Telco announced that they would put a $2.20 administration fee on all payments made in person.
Even for Telstra, who have over the years dug up creative ways to convince their customers to go elsewhere, this is a coup.
Have the accountants finally taken over the madhouse? Is there anybody in marketing home (or are they all out to lunch with the ad agency?) Even if they are actually just catching up to the usurious practices of several of their competitors, the opportunity to spotlight the raping of their retail customers pockets has not been missed.
We all know that in-person service is more expensive than electronic, it is also a pretty good way for a business to connect with and understand its customers, but that is clearly of no value to Telstra who apparently know all there is to know about marketing and their customers.
Pity about the shareholders who have seen an impressive erosion of the value of their shareholdings, even before the impact of the WFC is taken into account. Is there a connection here?
So to the award, a new category, recognizing excellence in marketing stupidity, the “Twit Of The Year Award” (TOTYA) has been created to recognize Telstra’s excellence in pissing off customers. A stellar performance this year, on top of the continual failure of their bigpond servers to work reliably, a hefty premium sought for mobile internet connection, and just a general “get stuffed” attitude displayed to just about everybody throughout the year. Well done Telstra, a super performance!
