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You would think that it might be reasonable to assume that good companies aspire to provide great customer service, wouldn’t you. Some companies establish customer service as their primary goal.
The bigger the company, the more the focus on the customer, in my view. But how much do we, as customers, help them to achieve that goal?
All too often customers get on the phone to a company, already in bitching mode, and it goes down hill from there. When the service that you would have liked to have received doesn’t eventuate you start to magnify the problem in your own head and allow your anger to be taken out on the poor guy at the other end of the phone. If the operator happens to speak with a foreign accent and is at a call centre in India or the Philippines the problem can escalate further and faster.
It’s hard to imagine that things can improve when you start with this scenario.
The problem, that I believe happens all too often, is that the customer sets totally the wrong modality to get positive results. Problems with products or services are quite real, but may actually be a manifestation of a deep seated, poor or failed internal process within the supplier’s organization that is hidden from view to the management. And customer service normally doesn’t have sufficient clout to motivate that kind of organizational change except under extraordinary circumstances.
I have been reflecting on this because of a personal experience over the last four years that eight weeks ago I decided to stop being angry about and instead to fix. I decided that I had to use all the things that I know about companies and about people and teach to students get results. It was also an experiment since I had no idea whether the theory would work, and it needed for me to understand what was happening and adapt my strategy as new information became available and was processed.
One thing that I believe now is that any successful big brand has as a core philosophy a commitment to provide great customer service. Big companies with such a commitment spend a lot of money on training their staff and I find now that big company customer service employees are all tremendously polite, helpful and dedicated to delivering the optimum result for me as a customer. That is a great start and is the gateway to getting what you want.
Here is the strategy that I used and which you can too if you want to get results:
Log each call, for time, content and quality, just as they do. Keep notes. As a result, every time you speak to a new operator you can refer them back to a particular conversation and the date that you had it. If you want good customer service, there is a responsibility on the part of you as a customer to identify the processes that the company uses and then to mirror them as closely as possible. This is rule #1 of getting great customer service. Use their methodologies, because they work.
Rule #2 is as extension of this: Be as friendly as possible with the customer service representative, the operator, in fact every one that you deal with. It’s a kind of variation on Stockholm Syndrome. The quicker you can establish that you are in this together the more you will get empathy from the other party. In any case there is absolutely nothing to be gained and a lot to be lost from being uptight or rude, regardless of how you may feel. And remember, most of the people that deal with your customer service rep are going to have been rude and uptight. Give your customer service rep a good and memorable experience. They will work that much harder on your behalf. They may even drop a few interesting pieces of information about the company here and there that may be helpful in your quest.
Understand that the problems associated with technology – often the reason for the problem – are often as the result of complex management policies in entirely separate parts of an organization. Problems of this kind are difficult to fix and are going to become more and more familiar as technology intersects with business models and finance and businesses are not sufficiently adaptive for the speed of change.
The solution is all about establishing a common ground for solving the problem. That translates into getting both parties to understand that there is only one language that you will ultimately be able to use – economics.
Regardless of what the problem is, there is going to be a cost for the supplier. Obviously there is cost to the customer, you, in not having the problem fixed. When both parties start understanding that their common ground is economic you can get things done.
This will mean that you have to find a way to get moved up the customer service food chain to the point at which someone has authority. This will probably take time. It is not going to come from saying to someone, “I want to talk to someone more senior”. It comes from being super-nice to the person you deal with to the point that they really want to help, and realize that they are not equipped to do that.
You have to have patience. Patience is what enables you to get real results. Companies rely on the customers wanting instant gratification. They too want to get a problem solved quickly and move on, because all that customer service time costs money. What you need to do is to use that insight against them. When you phone a help line for a company and you hear that recorded message that says words to the effect of “We record your call to measure quality”, that is when you know that you need to reduce the speed of your heartbeat, lower the tone of your voice from angst to calm-and-measured, and get prepared to stay on the line for as long as is possible. But it needs to be with a human being and not a computer – ideally a human who is not in a low priced labour market, but instead is in your home country.
Whatever the problem is, fixing it has a cost. Some things cost more than others to fix. Some things require entirely different departments with different discretionary expenditure budgets to be properly fixed. Most of the time this kind of problem is out of the control of the customer service department at any level whatsoever. This is important. Because it means that you have to find another pathway to resolution, and offer it to your new best friend – the customer service guy.
The other important thing to remember is that everyone that you deal with has a list of known problems and a set of verbal responses to the problems in a well rehearsed, and probably written script that pops up on the service rep’s screen as soon as your problem is entered into a text box on their computer screen. Once you realize that the company you are dealing with already knows virtually every problem that can arise and has a planned – and costed – response to it, you are on your way to understanding how to deal with it.
The primary tactic by companies is to put you on shaky ground by positioning you in unfamiliar territory. That is most easily achieved by making the customer believe that there is a technical problem that is in a separate part of the system and therefore not able to be resolved. They will give you a technical reason that is constructed to put you off balance, and hopefully to get rid of you. Remember that from an economic point of view, they want to get rid of you as quickly as possible without actually doing anything. That keeps the costs down. Once you understand their script you can start using it against them. You may have to figure out how to do that.
Your ultimate goal is to keep their costs up. You achieve this by keeping them on the line.
Next, you have to escalate your problem to the point that someone higher up the food chain is paying attention. They will try to buy you off. You will be offered something that appears to help you and is designed to appease you. Whatever they offer will have material value. Your inclination at this point in time is likely to be relieved that you got somewhere and to just roll over and accept the proposal as a reasonable solution, even though it doesn’t go anywhere near what you want. You need to “qualify” your acceptance of whatever is offered. This is a key point in the service paradigm carefully scripted by the company’s lawyers. This is the part of the process where the company will have made a record of the customer – that is you – having accepted a “consideration” as an agreed “resolution”. All businesses have some kind of statutory authority they need to answer to in the event of complaint. If they are able to show in the records of dealing with you that you were provided with a consideration that you accepted, that was the agreed method for conflict resolution, you don’t have a leg to stand on if you want to take it further.
If, however, you respond to the offer by politely saying that you appreciate the kind offer, and are happy to accept it provided that it is not considered as acceptance of full resolution, then the record will reflect that. The probability is that at this point the offer will be withdrawn but you will move up the food chain one more notch, and hopefully get to a more concrete, economically better outcome.
Remember, once again, that this is not about solving your problem, it is about you helping them solve their problem. Their problem is to make you satisfied. Instead of saying to their customer service people in an irate voice, “Do you realize that this is costing me money?”, say to them, “Do you realize that I have plenty of time and patience, an unlimited supply in fact. And for every hour that I am able to spend with you or one of your colleagues there is a cost. By my calculations the continuing cost associated with solving my problem represents a negative margin contribution of $x”. This is how you get things done.
Send me your customer service experiences. I would like to hear how you have successfully negotiated good results – or where you have failed.
Jan 12
6
The Year Ahead
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It looks like it is going to be a big year.
This year I will be back at University Of Wollongong teaching in the Arts Faculty – the same subject as last semester, ARTS301. I had tremendous feedback last semester from students. The subject is really about helping those about to graduate to understand how to create the optimum onramp into business.
I am also going to teach a strategic management course at the AIIM in Sydney, which should be interesting. And, while on the academic side of things, I also have some funding approved to undertake a research project that will examine the value that businesses place on Science and Engineering PhD students and which will enable direct engagements to take place between students and high tech businesses. I will be writing about this over the coming weeks. I hope that some of the material gleaned will become part of a forthcoming book. The goal of the research is multi-functional. Hopefully it will enable PhD students to build a greater appreciation of the need to build an understanding of what industry wants, it should also grow the network of end-users for UOW, and it will hopefully also yield some useful insights into the vision of industry in this country…. (and much, much more!)
I also have several corporate advisory opportunities lined up in conjunction with a firm in Sydney. These are focused in the online retail sector, and life sciences at this point in time. I am also hopeful that the hydrogen production technology business that is being spun out at UOW and which I wrote the business plan for, will provide some further interesting opportunities.
Whenever I look at a sector of industry these days I find that there is a lot of legacy thinking present that doesn’t fully appreciate the way that either the digital economy or globalization are impacting them. This, in spite of the fact that some very bright people have been hired to work for some of the major corporates that are affected.
I see certain parts of retail as the sector that is changing rapidly and moving toward tipping points in a number of places. The Australian retail sector is already in stress as it is impacted by online sales.The entry of Oliver Samwer and Rocket into online retail in Australia toward the end of 2011 with a focus on disrupting some of the existing online retail operators shows just how vigorous the competition is going to get. By their own admission he is a take no prisoners kind of guy. (See this story on him for an insight)
The irony is that the retailers who whinge the loudest about online think that they are having the lunch eaten by importers. The fact of the matter is that there are some products that are being shipped into the county at low prices, but the competition between local online retailers is equally fierce. What happens is the creation of a very well defined, but not overtly visible, two tier retail economy. The tiers of activity are ironically substantially defined by the discretionary income of the consumers. Those who have the least available cash purchase goods at retailers where credit is easiest and consequently pay the highest prices. Those who have the greatest discretionary income purchase at the cheapest price. This bifurcation of the market is going to influence advertising on mainstream media, which in turn is going to influence content purchase.
The value shoppers have the greatest capacity to continue to spend, while the high margin shoppers, are actually customers for high risk lenders with retailers acting fundamentally as re-sellers of credit. As a result we can expect the standard of content to become even more of a race to the bottom, to provide entertainment that can be built around ads for Harvey Norman and businesses that cater to the demographic that accepts paying high prices for goods! Ironically this should result in higher A+ viewers for SBS and the ABC, since the Foxtel franchise tends to recycle the same programming again and again, and notwithstanding its purchase of Austar is going to find that it is caught between the cleft stick of subscriber churn and increased costs of purchase of programming from the major studios.
At the physical end of retail this leads us to a point where the high priced shopping complexes which are reliant on foot traffic from high value customers will have decreasing foot traffic since their demographic will shop more from home to find competitive prices, not have to deal with traffic, and is not interested in the homogenized offerings of the major chains.
What that means is that the major shopping centres and their investors are going to start to feel the pinch. They will find that some of their smaller retailers just can’t compete. These are the retailers that don’t have the depth of financial resilience, nor the motivation to compete aggressively online. If these retailers don’t move online they will go under. When these businesses find that the foot traffic at the big mall is not converting into sales, they will quit. When that happens the rot will set in. The big retailers can find a solution, but the probability is that they will only look at the disruption from technology, and not look at a host of other things that are all part of what is very clearly a “wicked problem”.
Solving wicked problems is going to be part of the goal for this year.
Related articles
- Online sales a concern for retailers (news.smh.com.au)
- I Like You, But Not That Way: How Retailers Lose & Win Back Customers (rohitbhargava.com)
- Online spending affecting retail (propellresearch.wordpress.com)
- Retailers told: go online, or wither on vine (theage.com.au)
- Online holiday shopping surged in 2011 to $37.2 billion (zdnet.com)
- Retail outlook darkens (theage.com.au)
- 2012 – the year when traditional retail really starts to hurt (theequitykicker.com)
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This year has been incredibly busy. Next year looks set to be even busier – in my life certainly.
As we all seemingly accelerate toward the adoption of more toys, more technology, with more speed and more connectivity, I find myself seeing more clearly what is happening on another plane, and find that many of the people I meet and talk to are being blindsided by the enormous focus required from them to execute on the tasks that they have in front of them.
I believe that we all are unconsciously moving to a place where instant gratification is expected, required, and if not delivered, is a primary cause of our frustration and sense of personal failure.
It is one of the primary causes for the failure of some start up businesses, where the planning process is less important than the get to market. While I believe that getting to market is imperative and needs to take place in order to better understand market forces, I also believe that the information gleaned on the way needs to be incorporated into the plan with the plan morphing all the while in order to build a better engagement. Businesses who don’t plan for change from the outset are doomed to failure. And societies that are obsessed with instant gratification are bound to become frustrated by the inability to be satisfied and will ultimately fail too! (One of the people whose academic work in this field is really fascinating is Walter Mischel, who did the famous Marshmallow Test on children. If you haven’t read about it, I urge you to. It is actually much more important now for society, I believe, than the work that Stanley Milgram did).
I now believe that by developing a personal discipline of deferment of gratification I am able to take much more control of my life. By changing gear from need to desire, kind of like putting an item into the Amazon shopping basket for later on, the whole dynamic of financial and personal control is shifted. People who are driven by needs are frankly no different to junkies looking for their next hit. And most consumers who have Pavlovian responses to the calls for action that they are exposed to are no different.
Your new year’s resolution: Take control of the purchase decision by deferring it by a week or a month. See how much your life can change.
Oct 11
23
Musings On A Sunday Afternoon.
Last weekend my wife and were guests with a friend who is a barrister, and on the way to becoming a judge, all
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being well. We were talking about the mobile devices that we each had. He does not have one. No iPhone, no iPad, no Blackberry – not even a good old fashioned mobile phone. His wife gives him one of hers when he goes travels so that she can get hold of him, but he doesn’t know the number of it and doesn’t know how to place a call on it.
He doesn’t want to. He doesn’t want there to be any digital footprint of any activity that may in any way complicate his life. Pretty smart, actually.
I remember hearing some years ago that the head of a major media company in the US had never ever had a credit card. He paid for things that he purchased with cash.so that there could be no forensic record of where he had been and what he had bought.
When you think about the globalization of trade and and the national limitation of legal systems it does seem to lead to an inevitable nexus that is going to create all kinds of problems for society as the legal system tries to deal with something that it has had to avoid having any experience of. Even more baffling than expecting a Catholic priest to provide advice on sex (I’m sure that many of them actually are celibate in spite of their bad press recently!).
We tend to forget that we are all in motion heading down vectors of varying speed and direction governed partly by our personal experience, partly by the geography that we live in and the bandwidth that we have access to, partly by our language and our culture – an incredible host of modifying factors. We observe what is happening around us with the belief that we have a similar vantage point to everyone else. The facts, however, are quite different and when we start looking at the heart of national governance we are starting to see some cracks appearing in the system.
We are now still only at the beginning of experiencing life in the digital economy – a totally globalized environment where a company like FaceBook is more valuable than most of the companies in this country and it hasn’t even gone public yet: where the recommendations to view content are growing exponentially.
On the other hand we have the political system in this country which celebrates the rise of the Arab Spring and the birth of democracy in countries like Libya. And then we see the rise of the movement to occupy Wall St. All this happening while our law makers, those politicians elected to power by the people, are really beholden to the lobbyists working for the major corporations.
And then on another hand again we have the judiciary, who are utterly out of touch with the whole digital economy, because they don’t need to make their lives even more complicated nor to create any possible vulnerability….
And I haven’t even got to the banks…
I can’t see this story having an orderly and happy ending. But I can see a lot more opportunities in developing more digital widgets that recognize that the system has no hope of righting itself until it has suffered a much bigger failure than anything we have experienced so far.
How far away might that be? Not sure, but my bet would be that there is no point in complaining about what any of us think might be wrong. There is no way back. We need to develop ever better technologies that apply the principles of productivity improvements in ways that have not yet been considered.
Last Thursday I went our for my morning walk with my wife, Robyn. She told me that we had a problem with our washing machine. She thought that the motor had given up the ghost. We have had it for some time so we decided not to bother with calling a repair man and to bite the bullet and purchase a new one.
We had a lot of laundry and a long weekend coming up, but as it was Thursday neither she nor I had an expectation of getting one. She made a couple of calls and told me that she had found the model she wanted – a Bosch. It was available from a nearby Harvey Norman store for just under $1,200, but the same model was also available from Joyce Mayne for under $800. I suggested that we should also check online with Appliances Online because we had bought a dishwasher through them which had worked out well on both price and delivery – because they don’t charge for the delivery costs.
I found exactly the same Bosch device at Appliance Online for $10 less than the quoted price from Joyce Mayne. The price included delivery, installation and disposal of the old machine at no extra cost.
At that point I got a phone call from a sales person at Joyce Mayne, who Robyn had called to check on availability. The sales lady said that the machine was in stock at the warehouse in Sydney, but that it would not be able to be delivered until next Thursday; there would be a $15 charge for disposal of the old machine, a $40 charge for delivery – and that she had dropped this price from the normal $45, but that this did not include installation.
I told her that I was looking at the same product online…. cheaper.
So she asked me what would happen if I needed a warranty call…. clearly trying to get me to feel uncertain about after sales support. I responded, because I have been through this with a number of devices, “Service calls are handled by the manufacturer not by the retailer”.
So on line I clicked on the “Preferred Delivery Date” button, requesting Friday, the following day expecting to get a call to say that we would have to wait until the following Thursday.
The website accepted the date, accepted my credit card and an automated email response came back, as they do.
The next day by 10.30am the new machine was delivered, installed and the old machine out of the house. Done. A less than 24 hour turn around from order to installation from a remote, pure play web business when a local, bricks and mortar business couldn’t match the value proposition on price, on delivery, on timing of delivery, in fact on any of the key purchase criteria that you would expect.
Is it any wonder that retail will never be the same.
Clearly the Appliance Online business must be built on having a direct ability to automatically access and indent inventory, access and book trucking, in a seamless way where there is only light touch human intervention. They presumably have no warehousing costs, no retail location costs, and so can set their prices at precisely the level that will capture the business.
On the other hand Joyce Mayne, as a discount business, has to deal with the cost of their retail space and employees, with the employees watch potential sales disappear before their very eyes.
Harvey Norman, one assumes, has an entirely different business model. Since they offer ultra long no-repayment hire purchase terms, I would believe that their model is to sell to people who can’t afford to pay cash, and therefore they take as much of the available margin as they can in return for having the relationship with GE Capital who provide the finance.
So in the future I can see companies like Harvey Norman surviving, but I can’t see how the big box discounters can compete with online.
Its not about imports that avoid the GST. Its about service and time of delivery and price. These three things mean that a company like Appliances Online will continue to build brand momentum and win, win, win.
Related articles
- Harvey Norman posts small sales rise (news.theage.com.au)
- Displaying competitor prices proves successful for Appliances Online (uk.prweb.com)
- DRL-owned Appliances Online Partners with Fredhopper for Customer-led Search and Navigation Website Overhaul (uk.prweb.com)
- Appliances Online to Offer Delivery on Bank Holiday Monday (prweb.com)
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Sep 11
23
So You Like To Eat Fish….?
This is not really a story about marketing. However it is something that you might want to know and to think about if you like food.
We eat quite a bit of fish in our household. I normally buy fish at a little hole in the wall fish shop in Kiama. The shop is tiny. It is perched out at the end of the harbour on its own, and away from the rest of the town. Its run by Steve and Ruth, and its been in Steve’s family for a couple of generations apparently.
Because I go to the store regularly, I have gotten to know a little bit about the people, as you do when you see people regularly. One reason that I go to this particular fish shop is that almost all of the fish that they sell is caught locally. A few species of fish that are popular, like salmon, come in from Tasmania but almost everything else is caught locally and is super fresh.
Kiama Harbour
The other day I asked Steve whether the fish shop in Shell Harbour represented competition for him. This shop is in the big shopping complex there and has a lot of foot traffic and is always busy. Steve said that they probably were competition but that the people who came to his shop came for a different reason. The fish were different.
He gave me an example: the gemfish. The gemfish that Steve sells are caught on a line, by the local fisherman. The fish that are sold in the other shop are caught by the big industrial trawlers. I knew that when a fish is caught by a trawler it is caught in a big net that is dragged across the bottom of the ocean. What I didn’t realize is that when that takes place, the fish are caught up in the net for hours and hours, possibly a whole day, before the net is hauled up to the surface. While the fish are in the net they are being tumbled around like the clothes in a tumble drier. They bump into each other, bruise each other, possible even drown because they are no longer traveling in the right direction for their gills to work properly.
Steve brought out a gemfish and showed me the way that he could determine whether the fish was healthy. He showed me the beautiful colours of the scales and the sharpness of the eyes. He told me that when you get a trawled gemfish the scales are dull and so are the eyes. And the flesh is no longer firm.
It was a really fascinating story told by someone who clearly has passion for what they do and an intimate knowledge of his field. I suggested to Steve that he should shoot a video and put it up on YouTube – not to market himself or the shop, but just to inform people about fish. He is thinking about it.
Imagine though: How much more would we value the provenance of our food if we knew the processes by which they come from the source to the table?
I asked Steve and Ruth whether they sold much fish into the restaurant trade. My thought was, “surely chefs must value this sort of provenance?”. Steve told me that what typically happens with restaurants is that chefs send their staff out to pick up supplies and the staff are told to source very specific pieces of produce – 2 dozen 200 gram pieces of Dory – or whatever it may be. So the specifications by weight or size become the drivers for the restaurant rather than the quality!
Think about it next time you read that beautifully crafted copy on the menu of the restaurant that you are in!
But think too, about the possibilities that exist if you could market honesty and integrity. How valuable would Steve and Ruth’s product be if people understood the difference? They don’t charge any extra for what they sell, because they are hard-working honest-as-the-day-is-long people.
Their UVP is almost unique in the world we live in. Integrity.
Sep 11
12
Networks, Change and Managable Risk…
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- A study was recently completed by the Rensselaer Polytechnic Institute into the smallest number of people that through exerting influence in a network, can bring about change.
Apparently the number is slightly less than 10% – provided that the core base is highly committed and not prepared to change themselves.
This has quite significant implications for marketers, whether the product being sold is a political party, a concept, or a physical good. When the number of people that are required to hit critical mass is so small the potential for success becomes greater. The issue is clearly to follow the maxim that great marketers have laid down for as long as I can remember. That is to have a bull’s eye target market that you start with when you are planning to sell something, and, just as important, to ensure that the following that is built is passionate and unchangeable, bearing in mind that “the less reasonable will prevail”.
The less reasonable. Who are they? And what does this mean to you?
For those who are selling it means that you have to build a passionate following for your product. This is what some of the big online brands have managed to do on their way to greatness. Think about Google, Amazon… What could you do with your brand that would put you in that league? Or even a fraction of it!
It is a particularly interesting question at the moment given that we are now entering what I would call the third wave of internet business. This is the time when the mainstream of internet users start to “get it” and are sufficiently motivated by what they see around them to become passionate about it (the critical 10%, perhaps?).
It is this rising tide of mainstream web acceptance that is going to be the greatest disruptive force ever seen in commerce. Wherever passions can be awakened and ideas become entrenched there will be change. The task is all about finding reasons to create intractable support for products, brands, ideas by the magic 10%.
For most legacy businesses, this going back to basics is very hard. It requires leadership not just management. And for most mature businesses, leadership of the kind required means an increased level of risk. But in this model the paradox is that by not leading, the risk is absolutely increased.
Related articles
- How Revolutions Take Hold (bigthink.com)
- Study Shows Majority is Less Popular than Believed (arnoldit.com)
- 10% Influence Rule on Social Networks (broadstuff.com)
- Poll: Tea Party Out of Step with the Rest of U.S. on Climate (ecocentric.blogs.time.com)
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Digital technology empowers and it destroys. As the legacy silos entrench themselves and become more polar in their approach the silos start to crumble. It happens in business and more of that later. As is incredibly visible right now, it happens in politics.
Sometimes those silos are not really about the leader or the policy but about the system itself.
Look at what is happening right now in Australia, in the US, in the UK, and in North Africa right now.
In Australia only a few years ago John Howard finally lost his grip on power as a result of the rise of Kevin 07, powered by a social media campaign, at a time when half the population still hadn’t heard of FaceBook. Of course he wasn’t the first. Just before him Obama had raised more money in a campaign than anyone in history, all driven on the web.
These two leaders came in on a wave of expectation and euphoria. Finally two leaders who created more division than could have ever been thought possible, George W Bush and John Howard, were retired to the bench and two progressive new leaders came in – and these new leaders were unashamedly from the left.
Kevin Rudd created a level of antipathy with the mining industry that really runs Australia that motivated them to get rid of Mr Rudd. It doesn’t take a whole lot, it appears, to change a leader. All you have to do is to have enough money which buys influence and causes the hollow men of politics to worry about whether they will have a pension or not. They start pushing for change and then we get Julia Gillard.
However changes of leadership actually hide the real drivers of change that are now present in our society.
The thing that is the primary change maker is digital communications. It is causing a fundamental shift of power. The political support for change that was motivated to raise money and then elect Obama, the networking ability to use twitter to bring together people in Egypt and set off the Arab spring… these are instance of the power of the positive that are inherent in social networks.
However, what has been happening, in case no one noticed, is that there has been a massive growth in take up of digital communications tools by people who are not early adopters. The main stream actually started to “get it”. The people who are in the main stream, those people who don’t sit at the bleeding edge or in the early adopter sector, who had bought computers and who had gone online…. those people actually started to put together all the tools and to start to use them. Main street went main stream.
At the same time people on the extremes of politics started to understand that there was a wealth of leverage to be gained by using the same principles that had led to the rise of the left in the US and Australia. Socialize the raising of money, and socialize the rhetoric of fear, racism and hate. The seeds of fear sown so acutely by Howard and Bush and by Blair, are now producing the bitter fruit of ratbag paranoia in English speaking countries and leading directly to the almost historic low-polling figures of Gillard and Obama.
Each of these people has made a classic mistake of overestimating their own ability to influence the population with the power of their own rhetoric, and the need to share with the public at large a carefully engineered message that is balanced and measured and doesn’t spook the populace. Because each of them, when finally entering the vestibules of power, presumably gets to look at the books and to see the true state of the nation, of the economy, of the world. And it must be a scary thing, indeed.
But each of them at that point, also moves from being engaged with the real power that elected them, and moves to the traditional powers that run countries. Or think they do.
Its no different in business.
The power silos think that they are in power. The truth is that the population, the mass, is now absolutely in control. Except the mass has no idea of the power that it wields. Nor how it is being directed by the eminence grises that are in the back rooms plotting the ideas and stories that will drive emotion and action.
Rupert Murdoch historically was the master of this sort of approach. But he didn’t really get the web, in spite of his pronouncements about not being a digital native. Nice bit of scripting, but he didn’t really get what the web was about. The web is by nature anarchic. It breaks down the silos.
Those who are using it to do so are not necessarily doing it by design. But some of them certainly are. Look at the rise of the Tea Party. Misguided, perhaps. Misinformed, certainly. But absolutely motivated and becoming more powerful by the day.
Yes, the silos of power are crumbling.
One Australian friend of mine in the US and well connected in Australian Liberal politics said to me yesterday he thought that Tony Abbott would already be Prime Minister if it were not for the fact that people in his own party feel that he would be more dangerous in power than Julia Gillard, and would rapidly cause a decline in their own fortunes.
They too, forget that they serve at not just at the behest of the people, but at their whim too.
We are living now in a netherworld of change. The old systems appear to be in place but the world has actually shifted. When you walk down the main street and see the shops the brands all appear to be there and the same. You just don’t see all the digital brands that are even closer to hand, sitting in your pocket, on your smart phone. In politics it is the same. The leaders are on the TV each night making pronouncements. But the real action is taking place in your pocket on your smart phone with the facebook update and the twitter feed that is telling you the salacious, possibly unfounded rumour about who knows what, that will be the thing that you talk about at the water cooler at work tomorrow. These are the things that are driving our political destinies, our economies, our lives.
Leadership is not what we think it is anymore. And until the leaders understand that, they are all going to be doomed to be straw men (and women) whose time in the spotlight will be short lived. Their time in office will go down in history as being a failure of catastrophic proportions. The new poison chalice is leadership, until and unless the leaders understand that they need to lead from within a google engineered world.
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Image by James Clayton via Flickr
We all exist in networks of people. Before the industrial revolution they were close knit and very local. Fast forward through the industrial revolution and the ability to travel far and fast and into the digital era and we all have complex and vast networks of connections.
All of those connections have influence on our decision making. Some of the connections, such as the media we consume, has an inordinate influence on our decision making considering the fact that unlike our real world friends it is not there to help us when we have needs, but it is there to tell us how we should act – who we should vote for, what TV we should buy and where we should buy it etc.
The power of that influence is what has driven the value of the 30 second ad. As the highly individualized opportunity to influence afforded by targeted ads has emerged over the last dozen or so years, both the level of influence and the value of ads has changed markedly. But what about the value of the personal physical and direct connection?
This is the Trust Network – the people who you know in the real world, even if you don’t meet with them in person every day. These are the people who influence your views and the positions that you take even when they don’t realize it – and it all starts with them influencing your view about them.
A couple of cases in point:
I had a meeting with a company last week that wants to build up its marketing presence. They believe that they should be doing this online. This all sounds pretty straightforward. Then what is revealed is that the CFO of the parent company will not allow the company to undertake any internet banking. Sounds remarkable in this day and age, but it is true. So what we find is that the job that is required is not as much about developing a marketing campaign for the company, as it is about developing a management solution for the company so that the guys that want to build their business unit can actually get internal approvals to operate.
The one thing that makes even taking on a challenge of this kind is that I know one of the guys that wants to build the business and I trust him. I trust him enough to be prepared to try to help him tackle the problem that he has – even if the rewards are dubious at best…
Here is another.
I am working on a business development project for a start up. It is a highly technical proposition that really needs reference customers in place in order to validate the technology and indeed to enable detailed specifications for the technology to be developed. There is a potential client, but the client understands very well the value that they bring and the potential disruptive impact of the technology in the marketplace. As a result the client wants to insure against the risk that the technology may become available to its competitors. The simple solution might be to roll over and give them a piece of the IP. The problem with that though is that it will reduce significantly the ability to get investors into the company at this stage.
Of course this is one of those conundrums in which the elements of trust that need to be created also need to transcend the distance between the respective lawyers’ views and their motivation to invest the time into developing appropriate language that will give both sides a belief that they can trust the other. In this case, the one thing that will absolutely bring this deal undone, is to purely rely on the lawyers to solve the problem. With all respect to the lawyers in the room, their role in this instance is to protect their clients from risk, and the easiest way to do that is to make sure that the intent of an agreement is represented succinctly and simply. That means establishing and holding the line and not blinking.
But even the lawyers are influenced. So the job here has been to try to ensure that the individuals in the game increase their personal emotional stakes in the negotiations. These can help soften the harder voices in the room and prevent people from becoming entrenched in their decisions. I have some solutions for this that are very folksy and down home that have worked in the past, and will hopefully work in this case that help build personal trust.
Example: I built a very strong trust network in Japan at one point by the very simple process of gift giving. Every time I flew to Japan – which was roughly every 2 months at that time – I would take two cases of Australian wine with me, and then give bottles to pretty much every business contact who I met. I did this absolutely out of friendship and not to win any business contract. However the philosophy led to trust being built, and along with that trust, friendship, and along with these two ingredients, the willingness and interest in doing business.
The moral of the story is that the way to get business done is to build relationships that are absolutely not about business. Relationships that are about trust and a feeling that you can give something to the other without expecting anything in return.
All that finally leads me to the case of a student and an interaction he had with someone outside of the university. This came up yesterday. The student is working on a project and needed some information from the exterior party. The information wasn’t forthcoming, and granted, the outside person dropped the ball. The student got very uptight about the fact that he was doing work that would be valuable to the outside person and that therefore the outside person should co-operate and do things on the student’s timetable. The reality is that no one runs to the timetable of someone on the outside. To expect it is to be delusional. To get upset by it shows a weakness of character that can severely dent your ability to succeed.
When I act as the “marketing whisperer” for companies, a very important component of my time is spent in helping clients understand how small localized decisions can have vast ramifications with regard to future profitability, and that those decisions are not about how much media you buy.
Rather it is about how much trust can you build so that the entrenched decision making is in your favour rather than against you.
Related articles
- Rethinking Objectivity: How to Use Emotions in the Customer Experience for Effective Decision Making (customerthink.com)
- A Smarter Way to Network – Harvard Business Review Article (hr1services.com)
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- Lessons From Behavioral Science: Decision-making, Willpower, and Fatigue (philawdelphia.wordpress.com)
- Ethical Values in Business Decision Making (thinkup.waldenu.edu)
- Sell what you know instead of your time (theglobeandmail.com)
- Rational or Emotional – How Some Buying Decisions Are Made (executiveworks.wordpress.com)
Image via Wikipedia
Everyone wants more sales. They want more revenue. And they want more margin. And they want it now. They think that this involves strategy.
Actually what they are looking for is tactics, and when they adopt tactics without a strategy it will almost invariably fail.
Tactics is selling canned tomatoes at retail in the supermarket. Strategy is planting the seeds on the farm where the tomatoes are grown and canning them and then distributing them…. taking margin at every turn. Yes I know its very basic, but almost everywhere you turn there are people who don’t understand marketing who think that they can just buy it. The fact of the matter is almost invariably that marketing requires planting seeds.
Developing marketing concepts that are valuable takes time and means that you need to work with managers and executives of companies who are prepared to accept some ideas that go against the grain for a lot of them.
The most important of them is this: That really important sales invariably don’t take place because you tell someone to buy something. They take place because the marketer becomes so attuned to the marketplace that he or she can advise the company that he/she works for how they need to change in order to meet what the market wants…. next.
This is a subtle and complex problem and it takes real insights into how technology works, how people function and how to build the narrative for the people who develop the products….
That is the stuff that I try to impart on my students and it is the product that I provide to my clients… esoteric, yes, but very powerful.
Related articles
- What is a Tactical Business Plan? (thinkup.waldenu.edu)
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- Tactical Planning in Business (thinkup.waldenu.edu)
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- What “You’re Not Being Strategic” Really Means (measurablemarketing.typepad.com)
- Translating Strategy into Action (centralfloridac12.com)
