Use these seven principles to stay ahead of the pack in any market.
Most businesses fail to achieve their potential because of faulty thinking — which happens when business executives, owners, and managers don’t like news that runs contrary to the pictures inside their heads.
Although people delivering disagreeable messages to a manager or executive no longer lose their heads, as they did centuries ago, they can lose their jobs. As a result, those who need to know the truth first are often the last to get it. No one in business should ever forget the classic case of the Sears catalogue — 30 years of dramatic losses were hidden by top executives until a courageous new CEO closed the operation.
Why does it take so long for negative news to reach the top? Why do the people sitting around the table fail to speak up? No one wants to hear bad news. In fact, we tune it out. Rather than processing it, we get rid of it — “Sure, sales have gone down, but just wait until next quarter.” Then the next quarter arrives, and we hear, “We took a hit with the bad weather.”
Pitney Bowes introduced the Personal Post Office-postage meters for individuals and home-based businesses. But is this a good idea now that the world is sending messages by e-mail? Does everyone in the company believe this to be a wise strategy, or are they reticent to express contrary views? General Motors provides another example of rejecting information that goes against what they wanted to believe, and consequently going down dangerous paths. Until recently, Apple was another example — and there are many others.
When producers complain that it’s almost impossible to get appointments with prospects, the head of an insurance organization might say, “That’s just an excuse. You people are lazy. Hit the street earlier, and work later. They’re out there. Go get em!” What this boss should do is purge his mind of a faulty “corporate reality,” particularly when it comes to new business development, and replace it with “factual reality.”
Look at the world as it is rather than as you would like it to be — and stop handing business to the competition. Here are some principles for doing this:
Adding more salespeople won’t necessarily result in more sales. This should be obvious, yet somehow it isn’t. For example, the highly-regarded Life Insurance Market Research Association (LIMRA) issued a report suggesting that adding more sales agents won’t turn around the decade-long decline in Life insurance sales. The problem, as LIMRA points out, isn’t selling — it’s marketing. Yet, when most businesses want to grow sales, they long for more salespeople, when what’s really needed are more customers. Focus carefully and precisely on prospective customers, not on merely having more feet on the street. As the LIMRA researcher said, “[You] can do a heck of a lot more by identifying who is likely to buy.”
Unfortunately, macho-minded sales executives tend to want to storm the marketplace with foot soldiers — a strategy the military has long abandoned — and one that has run its course in business, too, because it’s inefficient and ineffective.
Start being customer-focused. Many of the companies that take pride in being customer-focused are only deluding themselves. The first step to letting the customer in is to stop all the self-serving nonsense that obscures or distorts reality. Here are a few examples of the nonsense spouted by professionals who should know better:
“We’re the best.” (Who says so?)
“We have 12 service centers.” (So what?)
“Let our experts help.” (Who says they’re “experts”?)
“Thirty years in the same location.” (What’s the value to the customer?)
Phrases like this are designed to bolster the way the company sees itself, not to attract or hold customers. The same is true with much of today’s advertising. The largest type in an ad, for example, is often the company name. This sends no message to a prospect. These ads focus on features, rather than benefits. How does that translate into helping the customer? Becoming customer-focused requires more than a mushy mission statement on the back of a business card.
Sell ideas, not just products or services. Xerox takes the lead with its digital multi-task equipment’s networking capability. These devices combine a good digital copier with a fax machine — yet that isn’t enough anymore. Having a network is the benefit that makes the equipment different. The idea that you can copy and fax from your desk, increasing productivity, makes the sale. Today’s customer isn’t captured by the latest model, but by the powerful and persuasive idea. From a marketing perspective, differentiating a business from its competitors makes the difference — not the brochures, logos, ads, or direct mail.
Be committed. Even though “commitment” is one of the big buzzwords in the current business vocabulary, other popular phrases tend to point to a different mindset. “We like to keep our options open,” states one executive; using the term “agility” to describe his approach. Another talks about “remaining flexible” or expresses pride in his firm’s “opportunistic posture.” Although these terms express useful, even essential, strategies for businesses, they also reflect a tentative commitment. In marketing and sales programs, this translates into campaigns that start with a flourish and either fade away quickly or are replaced with some other effort that soon disappears. What’s extolled as “agility” and “flexibility” is often nothing more than an inability to stay on course and follow through. Admittedly, many of these “programs” are ill-conceived and poorly executed.
Product promotions, sales contests, direct mail campaigns, Web site maintenance, and publishing newsletters are frequently efforts that die quickly. An inability to sustain projects shows that there’s a difference between being committed and just talking about it.
Think “program.” An inability to plan programs can be one of a manager’s most serious deficiencies. For example, some bank employees were going to be relocated to supermarket branches, so a training session was set up for them that involved planning basic promotions. Groups were asked to develop a month-long program for promoting a bank product. Two of the three groups designed posters; the third group outlined a schedule of events, activities, with announcements to take place during the entire 30-day period. Which team do you think was most objective?
In another situation, the principal of a Long Term Care insurance organization asked a marketing agency to develop a direct mail piece for businesses. The agency’s rep asked, “What do you want to do as a follow-up to the initial mailing?” Caught off guard, the executive didn’t know how to answer the question.
These aren’t isolated examples. A “one-shot” mentality is pervasive in business, but marketing and sales demand carefully crafted, consistent programs.
Be believable. We’re told that appearances are deceiving — yet they aren’t when it comes to marketing! Dr. Jeff Moss of Moss Nutrition, a distributor of nutritional supplements to health care professionals, had held seminars for doctors for years. His feedback from attendees was positive, even enthusiastic, yet the numbers bothered him. “Why aren’t more people signing up?” he asked.
A review of the seminar’s elements found that the prospect list was on target, as were the topics, presenters, locations, and dates. The promotional materials appeared to be the program’s one weak link. The mailers looked home-made and unprofessional, particularly compared to what other companies were sending to the same people. A new, attractive, high-quality mailer was designed and mailed. The responses from subsequent seminars began coming in immediately, producing nearly three times more registrations than in the past.
If it looks like junk mail, it is junk mail. If the presentation looks second-rate, so will the product.
Be genuine. Why do so many businesses (of all sizes) have an inferiority complex? Why do they want to portray themselves as something different than what they are? The answer: They’re not sure that what they are is acceptable to someone else — especially to prospective customers.
In a highly competitive business environment, the temptation to alter reality becomes increasingly severe. The same businesses that complain about job applicants who “enhance” their resumes do the same thing when presenting themselves. Their brochures are filled with hyperbole. How often has a company used a photograph of the building where its offices are located, implying that it owns the entire skyscraper? How many companies insist on including products and services that they can’t deliver in their promotional literature?
Irrational? Of course — and unnecessary, too. Inferiority complexes can cause businesses (like individuals) to behave inappropriately and push others away. The goal is to be genuine. Most businesses have more expertise, experience, and knowledge than customers ever know — that’s what today’s customers are seeking. It’s intellectual capital that counts today. Charlotte Otto, senior vice president for public affairs at Procter & Gamble, recommends that we look at ourselves as “knowledge engineers.”
Customers want credibility — a condition that occurs only when image is consistent with reality. Otherwise, the discomfort and dissonance raises a red flag.
Faulty thinking costs companies more sales than the outside competition ever has. Not wanting to hear the truth almost always leads to inappropriate, costly action. In the final analysis, how we think is as important as what we do.