Category Archives: Growth Strategies

Innovation Enablers!

boxSince our previous few posts have focused on barriers to innovation, it only seems right that we might also review some ideas for enabling it…

These methods require strong and empowering leadership to lay out the market constraints, make clear the threats from the changing environment and the opportunities that may arise, and provide the amnesty to take a risk to put ideas and observations on the table.

Necessity
When, in the 1950’s, Taiichi Ohno led a delegation to visit Ford to learn how to build automobiles, he was dismayed by the inventory, the huge warehouses and sprawling production facilities, the staggeringly large workforces. Toyota had nothing like those resources to emulate that system. They lacked the capital for all that inventory and they lacked the space for those sprawling production facilities. They needed a much leaner system, and so they invented one – because they had to!

Another  company observed that when their very survival was at risk, they began to implement a program of Continuous Improvement that called on everyone to contribute innovative implementable ideas. Because they had to develop new and better ways of operating, they did!

Similarly, a start-up company with few resources must innovate or quickly wither away. And it must be less scary to try something new and risk failure than it is to stay with the status quo. To create this condition, you must provide amnesty to reduce the risk of sharing new ideas; but it also helps if the status quo looks pretty untenable.

Outside the Box Thinking
Outsiders often come up with the best innovations, because they have no ties to the status quo. But outsiders often have a difficult time effecting real change because they are outsiders. A senior manager of a once innovative company wryly observed, “We say we like to bring in outsiders with fresh ideas, but when they share them we explain that’s not the way we do it here.”

Imagineering
To foster process innovation we must summon the courage to acknowledge the deep areas of waste that are part of our standard work. We all have this: inspection or rework or moving or waiting that is so intrinsically a part of the way we work that we cannot envision the work without it.

Because we cannot immediately think of any possible alternatives, we look the other way and thus we cannot innovate.

Summon the courage to put that waste on the table, calling it what it is. We have seen remarkable feats of innovation inspired by this simple act — recognizing waste for what it is. Go ahead and imagine the process without the steps that add no real value — that just compensate for a flaw somewhere in the process — and then take the time to search for ways to get to that vision.

Imagine perfection.

Investing in Continuous Improvement?

investinemployeesNot too long ago. a member of a prospective client’s senior management team spoke of a past consulting relationship in which the recommended “solution” for improving their process was to buy a new (and expensive!) software package.

He went on to say, “Upgrading an IT system is not the kind of answer we’re looking for… we want to learn how to improve the work!”

We completely agreed…

This same topic came up during a more recent discussion among CI Leaders. The group recognized that many organizations invest in technology or IT systems hoping to improve productivity, but also noted this type of investment frequently fails to deliver a sustainable solution.

As one member of the group said, “Software rarely fixes problems; people do. A bad process, with new software, will only run faster, not better.”

Thus the question was posed, “What kinds of investments can lead to successful continuous process improvement?

Among the top suggestions:

  • Invest in the staff. It’s remarkable to me how little soft-skill training employees get, in areas such as communication, teamwork, project management, delegation, and more. It’s assumed that people already have these abilities, but this is not always true.
  • Invest in team development. Even if people possess the right skills individually, they may not know how to work together as a team.
  • Invest in preparing people for change. This includes getting people to look at change through a positive lens, and maintaining proper staffing on the development and support side post-delivery, allowing for quick iterations with real-time user feedback.
  • Invest in developing the right culture for the improvement journey. Invest in our people, educate them, and shape their behavior through rewards and recognition.
  • Invest in defining improvement and quantifying the opportunities. Three useful questions, answered is this sequence, help to produce a path to improvement.
    1. What are we trying to accomplish?
    2. How will we know that a change is an improvement?
    3. What changes can we make that will produce improvement?

Building a High-Performance Culture of Continuous Improvement

culture3Numerous past posts have focused on the importance of an organization’s “culture” as a driver of continuous improvement and high-performance.

Critical to success in building this type of culture are the concepts of trust, amnesty, open communication, and engagement. In addition, we’ve found that the highest achieving organizations are those that have successfully planned and developed high performance cultures.

When helping clients build such cultures, our approach begins by identifying the underlying assumptions, beliefs and values that cause people to behave the way they do (the practices).

Key steps in helping clients develop a high performing/high achieving culture include:

  • Identifying a clear link between individual/team/department performance and organizational goals.
  • Helping people develop a clear sense of purpose.
  • Helping management devote the necessary time and attention to the performance management culture.
  • Creating a work environment that supports high quality and productivity.
  • Helping people at all levels understand the core values and beliefs which drive behavior.
  • Promoting practices that are in sync with organizational values and beliefs.
  • Clearly defining roles and responsibilities, performance gaps and accountabilities.
  • Help managers develop and refine their skills and ability to coach for improved performance.

While these steps might appear simple, they are not easy to implement; and nearly impossible to achieve without significant contributions of time and energy from senior leaders. These “contributions” must extend well beyond simply setting a strategy… leaders must also exemplify desired behaviors and consciously work at building and driving a high-performance culture if it is to be sustainable.

As Peter Drucker said, “Culture eats strategy for breakfast!”

The Waste in Your Sales Process?

ChasingWasteOutOfSales2The largest waste or opportunity in most commercial and industrial organizations is the lost gross margin that results from lost sales, sub-optimal pricing, excessive costs, and unnecessary costs in the sales and marketing processes.

Some of the most important processes in need of improvement include the process of selecting target markets, identifying prospects, connecting with those prospects, identifying needs, presenting the right solutions, closing sales, and retaining customers.

All of these can be systematically studied and dramatically improved.

We developed Chasing The Waste Out Of Sales to help every organization  create a high performing culture that produces increased sales dollars.

The book explains tools and techniques that will make real differences in your bottom line.  It’s the first and only book available to teach those in customer-oriented and management positions how to:

  • Collect and analyze key data
  • Share the information on a macro level
  • Study and improve processes
  • Make the changes in your organization that count

Read more…

Improving Sales

Imagine what it would be like if your company could make every sale!

How much revenue could be generated each year? How much profit? How much growth?

How would you manage it all? What changes or improvements to the current selling process do you think would be required for this to happen?

lowaimquote Of course it wouldn’t be reasonable to plan on making “every” sale, but as the James Russell Lowell quote suggests, it’s best to aim high!  But in an effort to do so, and when trying to answer these questions, most people discover that selling is a multifaceted activity, and identifying the waste that is common to the process is more challenging than expected.

To begin with, the physical work is tough to track because it’s done in different places (i.e., in the field, in showrooms, on the phone, etc.) under varying circumstances, and involves a constantly changing cast of characters (every customer is unique!).

In addition, standardized practices are not easy to establish due to regional variations in culture and acceptable conduct. And the appropriate “next step” in the process is constantly subject to change based upon several varying and unknown factors – how the customer or prospect will react to what’s put on the table, their decision-making process, communication gaps, and more!

But as is the case with all forms of work, once we sufficiently delve into the work involved in selling, we can identify waste and find tremendous opportunities for improvement.

Consider that all waste can be categorized in one of the following four ways:

  • Waste of material
  • Waste of capital
  • Waste of time
  • Lost opportunities

Over the years we have learned that the greatest waste tends to fall into the fourth category – the lost opportunities. These lost opportunities are most often due to sales that were not made, either because we didn’t discover the opportunity or because we lost to a competitor. Some of the lost opportunity can also be traced to sales we made at sub-optimum margin.

Over the next few posts we’ll look more closely at ways to improve the sales process and, in so doing, ways to reduce the number of lost opportunities.

Where is the Waste in Your Sales Process?

As you may have realized, the largest waste in most  commercial or industrial organizations
is in the sales area.

This perspective is explained in much greater detail in our handbook, Chasing the Waste Out of Sales,  But simply-stated, this waste tends to be a result of:

  • Lost gross margin that results from sales not made
  • Sub-optimal pricing
  • Excessive costs and unnecessary expenses in and affecting the sales process

Yet we’ve found that most companies working on process improvement tend to focus on manufacturing or administrative functions, either because they think there is more to be gained by improving these processes or because these are areas in which activity metrics and similar numbers are more readily available.

But the sales process can (and should!) be treated just like any work process; and whether you are a sales professional, sales manager or business owner, identifying and quantifying the waste in your sales process could be the best way for you to significantly impact this year’s revenue and profit numbers. To begin, consider the following questions:

  • How much time is spent speaking with or pursuing uninterested or unqualified leads?
  • How often are discounts given because of delivery delays or quality issues?
  • How often are discounts given as enticements because buying criteria are misunderstood?
  • How often are proposals rejected because they fail to align with customer needs?
  • How much time is spent expediting orders or handling errors?
  • How much time is spent dealing with customer service issues due to misunderstandings or fulfillment process complexities?
  • How much time is spent trying to collect on unpaid invoices due to incorrect addresses or discrepancies in the amount billed versus what customers expected?
  • How much time do sales personnel spend working on administrative tasks versus selling tasks?
  • How much money is spent on marketing materials that end up in the trash or don’t generate expected results?

All of the above-listed questions refer to process waste or, more appropriately stated, opportunities for improvement.

Of course other opportunities for identifying and eliminating sales process waste exist within account management or territory management plans, as evidenced by research presented in The New Rules of Sales Enablement, by Jeff Ernst, indicating that 65% of the average sales rep’s time is spent not selling .

In addition, beyond considering the number of sales calls that are made each day (we are keeping track, right?), what about the effectiveness of those calls?

What are the variables that impact the quality of each sales or business development call?

Why is it that some calls work out better than others, even when the customer profiles, needs and circumstances are similar? What causes the variation? How can we measure it? How can we reduce it, so that we can improve conversion rates of benchmarks such as calls-to-identified-opportunities or quotes-to-orders ratios?

If these questions have convinced you to take action, here are a few ideas for first steps:

  1. As with all improvement efforts, begin by gaining senior management’s backing and visible support.
  2. Gather data on sales-related activities to identify and chart waste of time, waste of material, waste of capital or waste resulting from missed opportunities.
  3. Use the charts to identify and measure direct and related process variation.
  4. Gather customer feedback to better understand how the process can be improved to better meet their needs and priorities. For example, we may find that our proposals are not being accepted because our offers don’t ideally-address customer needs; this would be a good thing to know so that we don’t decide to unnecessarily lower prices instead of improving our need-assessment process.
  5. Create a culture of improvement with the sales organization by raising awareness levels with respect to the above-referenced metrics and by measuring and rewarding desired behaviors.

Dealing With & Managing Change: Part 2

changeWe all know that effective leadership and continuous improvement involve driving change. Continuing this theme from our previous post, here are a few additional thoughts on how to manage change within your workplace:

  • Successful change cannot be mandated or forced
  • Help people recognize that we must change not to fight the current way, but for a better way
  • Successful change starts from within; we must help others to trust that the change will benefit the company and will benefit the workforce over the long-term
  • An honest behavioral self-analysis is a good start, but not always easy to accomplish; help people assess their own behavior with respect to change and to evaluate whether or not it is leading them toward their desired career path
  • Some people will appear that they’re buying in, but behave otherwise…
  • Help people recognize that it’s easier to change when you can, rather than when you have to

Value-added Work & Management’s Core Value-add

valueadded3Continuing our theme of “value-added” work, which in our previous post we defined as “the work our external customer would be willing to pay for if they knew what we were doing,” today’s post focuses on the first steps an organization might take to increase the percentage of total work that qualifies as being value-added.

It’s important to recognize at the outset that while customers may be willing to pay the price we ask, all of the waste is still on our dime!

And… every bit of waste that we eliminate can be taken right to our bottom line!

Many people and functions play a vital role in helping the internal customer provide value for the external customer. These are the folks on the edge of the value stream; some of them might provide key enablers such as technology, safety, or information to those creating the value for external customers, and some might remove the ‘debris’ (through inspection and rework) or impediments (through process improvements) to the swift flow of value to the external customer.

If we can eliminate the root causes of the “debris and impediments,” then the time we save can be redeployed to creating more value and making more money.

The core value-add of a manager is to study and improve the system of work. By using the insights and information of people doing the work and knowledge about improvement tools and methods, a manager improves the system of work so that everyone’s performance improves, more value is created, and the organization becomes stronger and more profitable.

Comment…

Engaging Customers on Social Media

A number of recent posts have focused on enterprise engagement, which involves engaging our workforce as well as our customers, channel partners, suppliers and the community.

In a recent focus group discussion, a number of participants indicated that their organizations did not have a formal process for engaging customers beyond standard sales and customer service protocols.

With this in mind, a recent post on The Gallup Blog shares some good fundamentals for using social media for this purpose – but beware! To be effective, we must go beyond “pushing product.”

“When companies focus their social media efforts on pushing product and not cultivating communities, they overlook the real potential of these channels,” the article states.

The piece goes on to explain that to positively influence purchasing decisions through social media, marketers should learn to use it to listen and interact. Consumers are more likely to engage when the brand-related posts they encounter are:

    • Authentic. Social media sites are highly personal and conversational. And, as Gallup finds, consumers who use these sites don’t want to hear a sales pitch. They’re more likely to listen and respond to companies that seem genuine and personable. Companies should back away from the hard sell and focus on creating more of an open dialogue with consumers
    • Responsive. The social media world is 24/7, and consumers expect timely responses – even on nights and weekends. Companies must be available to answer questions and reply to complaints and criticisms; ignoring negative feedback can do considerable damage to a brand’s reputation. Instead, companies must actively listen to what their customers are saying and respond accordingly. If they made mistakes, they must own up to them and take responsibility
    • Compelling. Content is everywhere, and consumers have the ability to pick and choose what they like. Companies must create compelling, interesting content that appeals to busy, picky social media users. This content should be original to the company and not related to sales or marketing. Consumers need a reason to visit and interact with a company’s social media site and to keep coming back.

Comment…

Your Business “R” Factor IV: Teams at the Top

rfactorCompleting our series on the value of workforce relationships, nothing brings to light the quality of relationships more than in the workings of a team. Due in large part to the quality movement of the 80’s and 90’s, teams have become the primary and core structure for getting work done and it would be difficult to find an organization which does not have “teamwork” as a fundamental value.

This is highly logical when you consider the facts that it is nearly impossible for a single person to possess the same amount of knowledge and experience that a high performing team possesses, and that the involvement of multiple people in decision-making strengthens commitment. The exchange of ideas that takes place in a team environment, as opposed to a setting in which people work in individual silos, promotes new thinking and innovation as well.

Yet, it is interesting that although the value of teams is readily accepted, it is rare to find teams that have truly reached their potential. In team language, this means they have yet to reach a level of high performance.

It’s the Relationship!

What is often missing is the realization that creating high performing teams is not just about implementing the basics of team structures. Going from an effective team to a high performing team requires additional skills, practice, commitment, and most importantly, in the words again of Mike Morrison, “It’s the relationship!” Teams seeking to become high performing must have at their very core strong relationships.

If you’d like to measure the strength of your organizational or team relationships, you might consider evaluating four key areas:

  • Mutual Accountability
  • Trust and Loyalty
  • Esprit de Corps
  • Commitment to Results

These characteristics are nicely exemplified by the preeminent model for high performance — The Navy SEALs! Their creed, actions, and their success solidly point to their reputation of high performance. Observe any high performing team and you will find these same characteristics evident; and not just “some of the time.” A high performing team reflects these characteristics in every way and at all times.

You might also take a look upward, or a more reflective look depending upon job function, because a concerted, focused effort needs to take place and, as is most often the case with any change or improvement initiative, it needs to happen at the top.

Hence it is an absolute requirement that the Senior Executive Team “walks the talk” of high performing teams. It is not enough to accept a “do as we say, not as we do” attitude. Especially when you consider that failure to model high performing team characteristics at the executive level is a sure path to mediocre team results throughout the organization.