Take two minutes to learn a LOT about your business…
Some years ago, I joined a technology SME to head it up through its next phase of growth. The business had started up long after the impact of a previous recession and was doing well on the back of a growing economy. From the outside, things looked rosy but inside, it maintained the same informal approach to systems and procedures, communication and control as it did in the start-up.
There was a disconnect between what the senior manager was aiming to do and what everyone else in the organisation thought was happening.
This is what I call the “Comet Effect”.
It can occur where the owner or senior manager focuses on growing the business virtually oblivious to all else in the operations. The effect can emanate itself in some very negative ways.
Middle managers and staff can be left to carry out tasks and make decisions they are not comfortable with or out of sync with the direction of the organisation. They can become demoralised or maybe even leave. Costs can run out of control because no one is made accountable. Inefficiencies can lead to the same thing because appropriate processes and procedures aren’t put in place.
Poor control increases risk to the business with all kinds of negative outcomes. Poor communication and inadequate involvement of staff de-motivates employees who become less productive. Staff turnover increases with direct cost to the business.
It isn’t rocket science to know how to stop the problem but it does involve a serious injection of structure into the business.
Depending on the particular business and the maturity of its management framework, there are lots of things to consider to gain better control over the business. Here’s just a few examples of what we installed in this business to improve things:
Emphasis on business development plans is obviously key to growing the business.
However as the business grows, inadequate attention to installing the right structures elsewhere in the organisation, commensurate with the particular phase of growth can have a negative effect in many different ways.
Find experts to assist you in areas you are not strong in.”
“Efficient” is being able to get things done. “Effective” is doing the right things in the right order, and making sure you address everything that is urgent, vital and important, in every part of your life.”
“One of the main reasons people don’t improve is that they are not honest with themselves.”
“With self-discipline almost anything can be achieved in every aspect of life.”
“Physical fitness and a love of reading are among the most important gifts you can give your children.”
“one way to get your priorities accomplished is to schedule them into your calendar.”
“Surround yourself with great people.”
Your team members are only human. Goals and meaningful feedback go a long way towards providing productive, consistent motivation.When good students suddenly lose motivation, parents may threaten to take away the smart phone or the car. But neither of these tactics provides good, long-term motivation. To get students back on track, parents can enlist the help of a tutor. As a manager, you too can draw upon elite tutors’ strategies to motivate your team. Here’s how:
The first step in motivating a faltering individual is identifying the reason for the changed behavior. While it’s tempting to attribute the issue to boredom or laziness, there’s very likely a more significant problem.
Goal setting can also help you motivate your team.
Everyone deserves genuine feedback on his or her performance. Feedback rewards individuals for their accomplishments, encourages them to improve and empowers them to achieve their goals. Authentic feedback does more than just validate the person who earns it — it validates the relationship between the giver and the receiver.
If you notice a decrease in motivation, avoid assuming that the individual is apathetic or careless. Identify the source of the problem, set goals to guide that individual back on track and lead with meaningful praise and purposeful encouragement. When your whole team is earnestly invested, your company will be able to rise to any challenge.
It’s hard to believe, but some businesses are still slow to embrace social media for marketing and brand-building purposes. These businesses cling to outmoded methods of marketing without taking into account just how influential and far-reaching social media has become for consumers in B2C and B2B.
“Not having the right social media channels for your customers to reach out to you is the 1985 equivalent of not having a phone line,”In case you’re not yet fully on board with social media, here are compelling reasons why not using it can harm your business:
Let’s assume you do things right and you’ve built a small, but loyal customer base. Wouldn’t it help to let more people know about your satisfied customers? On social media, businesses routinely share customer testimonials with their followers, while customers are happy to share their buying experiences all on their own.
Whether you like it or not, customers unhappy with your product or service won’t hesitate to share their experiences on Facebook and other platforms. Without a social media presence, how can you monitor negative reviews or attempt to answer them and demonstrate a policy of responsiveness?
Social media is interactive. Small businesses build communities around their brands and instill customer loyalty. Engagement may include sharing product updates, conducting customer surveys, sponsoring contests, etc. A small business that lacks a social media presence must work much harder to engage its customer base.
Not only does creating and distributing advertisements add up to significant costs, the level of customer trust in traditional advertising is fairly low. Start-ups in particular enjoy a much higher success rate using social media to promote their products or services.
It’s likely you’re an expert in your particular field of business. But without a social media presence, who will ever know? Small businesses regularly create and promote content of value to their followers, in the process building a reputation as an industry thought-leader — which adds credibility when they reach out to prospective customers.
Businesses use Facebook and other channels to launch a new product or announce a major upgrade. Customers are sometimes invited via social media to “test-drive” the new product and offer helpful feedback. This kind of customer input increases the odds of a successful launch or upgrade, because a business knows in advance what works (and what doesn’t work) with their target audiences.
Never assume that just because you don’t have a social media presence, the competition is abstaining as well. They’re not! Monitoring the social media activity of competitors enables you to stay informed about their marketing efforts and who their customers are — information that could prove essential for your own marketing campaigns.
Businesses use social media as an active employee-recruitment tool — and job candidates do the same when it comes to checking out potential employers. Having a vibrant online presence (not just your business website) makes your company more attractive to talented candidates, the very individuals you most want to apply for your open positions.
Sooner or later, almost every business experiences some type of public relations or product-related crisis. Companies that successfully “bounce back” usually integrate crisis management with social media in the planning stages. They use Twitter and other channels to beat back unfounded rumors and speculation, while ensuring a continuous flow of customer-friendly information. A business with no social media presence can be badly harmed by a tsunami of angry voices online.
Late to the show? Look at social media platforms your customers follow and start building your own community of fans and friends alike.
At many companies it’s easy to point fingers at the service people, or the sales people, or the account handlers. Customer experience is their job, it’s not my job. But I think delivering a better customer experience should be considered everyone’s job, and everyone needs to know something about what that means.
A colleague of mine used to do consulting work for restaurant chains. He said in evaluating any sit-down restaurant he visited, there were two things he absolutely insisted that every single employee should know, from maitre d’ to the kitchen clean-up crew:
The thing is, customers don’t know who does what at a company they deal with, and for the most part they don’t really care. If a customer happens to be talking with an accountant at the company they’re buying from, they’re not really interested in that person’s department or job function. They’re focused on the problem they have. But if the accountant – or the administrative assistant, or the product engineer – doesn’t know anything about how the firm wants to serve customers, then it’s likely to generate a bad experience. And the customer won’t ascribe this bad experience to having dealt with the wrong person at the company, either. They’ll ascribe it to having dealt with the wrong company.
A significant side benefit of this whole idea is that when everyone at a company knows not just what’s on offer but also the right way to treat customers, the culture at the firm will cohere around building the business. Workers who are united by a common vision of what the company’s mission is are more likely to make the right decision in difficult or problematic circumstances. And they’re more likely to enjoy working for you, as well.
So ask yourself whether everyone at your business knows what’s on your company’s menu, and how to seat a guest.
Karl is a Sales Professional with a leading supplier of raw materials to manufacturers. For 15 years, Karl has been using Sales 101 techniques to build strong relationships with clients
He is now in a position to implement price increases for the first time in seven years. Karl doesn’t know what to do.
Like many Sales Professionals in the volatile economic conditions of the 21st century, Karl has never had to communicate price increases to his clients. Lacking experience in positioning a price increase, he is afraid of weakening the strong relationships that he has developed or worse, losing clients by delivering this difficult message. However, for Karl, as for many Sales Professionals, economic growth is making price increases inevitable.
Fortunately, it is possible to maintain strong client relationships in this situation by following five techniques borrowed from Sales 101 for leading a consultative conversation about price increases:
There are a number of reasons for increasing prices. For example:
Think through the implications of the price increase for your client, and be prepared to acknowledge these implications. Anticipate in advance how the client will react to the increase so that you are best prepared to address his/her objections and concerns.
As briefly as possible, lay out for the client why you are implementing a price increase, how much the increase will be, and when it takes effect. Do not belabor the point with excessive rationale. Remain neutral and confident. Avoid using phrases like, I know this increase is hard on you … or, I know this increase seems high … which could create a perception that you don’t support your company’s decision.
Anything you say after that point will open up room for negotiation in the client’s mind. Do not ask a checking question. If the client raises objections or concerns, use the Objection Resolution Model to address them, but avoid creating the impression that the increase is negotiable.
End on a positive note. Thank the client for understanding and for his/her continued business. Express your enthusiasm for continuing to work together.What sales techniques have you used to position price increases? Share them with us in the comments below!
“When it comes to the prices we pay, we study them, we map them, we work on them. But with the prices we charge, we are too sloppy!”
But unfortunately managers and entrepreneurs seem to neglect the issue. In one of our global pricing studies we asked over 3,900 high-level decision makers from all major service and manufacturing industries around the world how they set their prices. The main findings in a nutshell: many of them don’t get the money for the value they deliver. And weak pricing cuts their profits by 25 percent.
Every company has the ability to achieve high pricing power. If a company can offer its customers real value and communicate that through a top brand, this will translate into money.Asked what or who is responsible for their weak pricing, managers often blame “tough competition”. Another favorite is to blame customers, and stating that the customers are very consolidated and have tremendous negotiation power is very common. These are all excuses that avoid getting to the bottom of the problem. Poor pricing performance is not a question of fate; it is largely up to each company to either become a pricing champion or go the road of devastating price wars.There are no structural reasons for pricing weakness, but three fundamental causes that make the difference:
A few simple steps can help tremendously when it comes to pricing.
“If you ask your people to strive for volume, you should not be too surprised when you end up in a price war.”The effect of price wars on profits is disastrous for all sides. There are no winners— except the customer. That’s why companies should avoid price wars if at all possible and it’s up to their managers and owners to encourage their employees to strive for profit, not for market share.
Neglecting prices and being weak at pricing will also prove devastating with inflation around the corner. What will happen if you are weak at pricing, you will typically achieve only half of your targeted price increases. That means you only get 53 percent in the end, although you wanted 100 percent of your targeted price.
Although price increases are essential for survival in inflation periods, managers and entrepreneurs are mostly insecure about how to plan and implement price increases. There are a few steps though that can help them.
First and foremost, you need a consistent and systematic process for pricing. For every single activity companies have detailed processes with descriptions and explanations, but when it comes to price increases many don’t exactly know what to do. Such a process includes starting with the price increase targets, selecting the right instruments, preparing the price increase and, finally, executing it.
Price increases are often accompanied by “goodies”, discounts, give-aways, customer-friendly payment terms, etc. Many fail to factor in the effect of these customer-friendly measures.
Also, it helps to think creatively about prices. Besides a classical list price increase, there are tens or perhaps even hundreds of price instruments available. The key is to go through the list of possible instruments, analyze which one fits your specific situation the best and then make a conscious decision as to which instruments to take – be it discounts, shorter payment terms, smaller package sizes and so on.Take this example: the price of a one-liter bottle is known by most consumers. Almost nobody overestimates the price of a one liter bottle of water. But customers have a much lower price awareness of the small pack. More importantly, 50 percentoverestimate the price.
If you want to increase the price of your water bottles, the solution seems clear: don’t touch the price of the one liter pack, but apply a disproportionally high increase for the small pack. This is a general message that applies to B2B as well as B2C companies:set different price increases by product/customer groups based on the level of price elasticity.
Companies often ask us whether they should be the first ones to make a price move. If a company is or wants to be the leader of an industry, then it must make the first move and set the anchor price.
Many but still too few companies are doing that. When you knock at your client’s door and ask for higher prices, the clients are already informed, they already know about the price change, and the bad news has already been communicated.
Implementing the new price is the job of the sales department, but very often sales is struggling with this task. Either they only manage to implement a small part of the planned price increase or they give away goodies and discounts in exchange for the price increase; the bottom line being that nothing is achieved.
Have you ever tried to change the behavior of an adult who had absolutely no interest in changing? How much luck did you have with your attempts at this? Have you ever tried to change the behavior of a spouse, partner or parent who had no interest in changing? How did that work out for you?
My guess is that if you have ever tried to change someone else’s behaviour, and that person did not want to change, you have been consistently unsuccessful in changing their behaviour. You may have even alienated the person you were trying to enlighten.
If they don’t care, don’t waste your time.
Research on coaching is clear and consistent. Coaching is most successful when applied to people who want to improve. This is true whether you are acting as a coach, a manager, a family member, or a friend.
Your time is very limited. The time you waste trying to change people who do not care is time stolen from people who do want to change.
As an example, back in Valley Station, Kentucky, my mother was an outstanding first grade school teacher. In Mom’s mind, I was always in the first grade, my Dad was in the first grade, and all of our relatives were in the first grade.
She was always correcting everybody.
Dad’s name was Bill. Mom was always scolding “Bill! Bill!” when he did something wrong. We bought a talking bird. In a remarkably short period of time the bird started screeching “Bill! Bill!” Now Dad was being corrected by a bird.
Years passed. When Mom corrected his faulty grammar for the thousandth time, Dad sighed, “Honey, I am 70 years old. Let it go.”
If you are still trying to change people who have no interest in changing, take Dad’s advice. Let it go.