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WHAT WE BELIEVED TO BE TRUE ISN’T

The more you engage with customers, the clearer things become and the easier it is to determine what you should be doing.

John Russell, President, Harley Davidson

Recently, I reached out to a friend from decades ago named Paul. During our teenage years, Paul and I worked at the local grocery store stocking shelves and packing groceries. We reminisced about the fun we’d had, the bosses we survived, and some of the unique customers we had encountered during the nearly 10 years we spent working together. The job itself was fundamentally quite simple—pack groceries without damaging them, be courteous to customers, keep the store clean at all times, and of course, do anything else a supervisor or manager asked you to do. Back then, the store was in its early days and customers flocked in the doors, creating a literal mad-house at times where there was not even a shopping cart for incoming patrons to grab.

During my time working as a grocery clerk, I witnessed a steady decline in the number of patrons coming to the store. I didn’t know it at the time, but there were some significant forces that were influencing this steady decline in business. Of course, because my paycheck wasn’t directly influenced other than a slight reduction in my weekly hours, which was offset by small annual increases in pay, I wasn’t too concerned. Neither were many of the other employees, for the very same reasons.

Fortunately, that grocery store is still alive in my hometown today. Notice I didn’t say, “alive and well”? The last few times that I’ve stopped by, I’ve been stunned by the lack of customers. There is often only a handful throughout the entire store, which begs the question: “How can they afford to keep the doors open?”

Having stayed in touch with several of my former colleagues from those days, including the former general manager, I’ve heard various perspectives on why the store began its sharp decline in sales more than 20 years ago, and why it continues today. Warning: despite these being isolated to a grocery retailer, my guess is that some of the following statements might sound familiar to you.

Former managers believe that the continued decline in investment in the store made by the head office, in conjunction with the steady increase in pay and benefits for the employees, is the underlying issue that has ultimately led to the store’s current unhealthy state.

Past employees believe that the unwillingness of management to listen to and act on their ideas to update the store layout, making it more appealing and welcoming to today’s customers, has resulted in the decline.

The few remaining employees who still work at the store are desperately praying for it to remain open until they can retire, often citing the local economy and increased competition of new grocery stores as the primary reasons for the store’s decline.

The reality is that all of these conditions have actually led to the store’s current state. As sales have declined, the grocery chain has invested less money in marketing and reduced its investment in many of its stores, choosing instead to redirect any revenue to stores in more largely populated areas that were financially thriving. Competition that has grown in both brick-and-mortar stores with newer layouts, better features such as in-store restaurants and coffee, combined with growing competition online for grocery customers, has also further exacerbated the decline in customers and revenue. Continued increases in overhead to operate the store, including employee wages and benefits, are obviously hard to swallow when revenue is on the decline, which only serves to further diminish the availability of cash to invest. Add to this that employees who have remained working in the store and who remember “How things used to be,” are often the very first to suggest, “We tried that before—it didn’t work” when it comes to introducing new ideas. This resistance makes improving the current situation even more difficult.

I share this example with you not to focus on the grocery industry or this store in particular, but to demonstrate that the growth challenges facing many organizations today are all too common regardless of your sector, region, or tenure in the marketplace. When you look behind the walls of many organizations, you’ll find they are struggling to grow (or even survive!) for many of the same reasons I just outlined. Sure, this doesn’t apply to all organizations, as there are a choice few who have grown sporadically, and others who have increased their revenue and market share through acquisition. But we can predominantly place most organizations on a bell curve to identify their success at achieving profitable growth. In the following figure, I outline how using a bell curve can clarify how elusive sustained and profitable growth can be.

In this chapter, I’m going to take on the notion that growth in a business is achieved only by those who figure out the magic formula of combining great marketing campaigns with strong selling processes underlined by a product or service that keeps customers coming back. In fact, in my experience, it’s these very notions that have led to the continued decline in both sales and revenue of many organizations today; often, it’s the result of listening to and following the same advice and practices that have been around for decades.

We’ll discuss how, despite all of the noise around the complexity of today’s customer, in fact, they are simple to understand, reach, and influence. In addition, we will dispel the myth around business growth that suggests “more is better,” and that doing more of what you’ve always done, just faster and better, will ultimately lead to winning more sales and closing more business. Lastly, I’ll introduce the concept of employee intelligence as a business growth tool; a strategy that underlies all of your efforts to achieve sustained growth; how it works, and the value it brings.

So let’s tackle the age-old question. With limited funds and time available in a competitive and changing marketplace, just what exactly is an executive or entrepreneur to do in order to put their business on a sustained growth trajectory?

The Simplicity of Today’s Customer

To answer the question of where to invest time and money to achieve growth, we need to first step back and assess the needs, both emotionally and logically, of today’s customer and consider if and how they have shifted. To begin, let’s first consider a question that I often use when helping CEOs and executives set their strategic vision:

“How have your customers’ buying preferences changed?”

Before you read any further, you might wonder, why would we look back rather than forward? Why not simply jump to drawing conclusions about our future customer needs, rather than reflecting back on what’s done, particularly when we all know that customer needs have evolved? The answer is simple. By considering the past, we can inform the future. As Winston Churchill once said, “The farther back you can look, the farther forward you are likely to see.”¹

You might also wonder why we would look back several decades when your business may have only been around for a few years. The answer is quite simple and hinges on our discussions from Chapter 1: people are the primary consideration when it comes to becoming an unstoppable organization. Organizations are built upon the knowledge and ideas of the people who work within them and, therefore, are shaped based on the extent to which its employees are permitted to share their experiences and ideas while practicing and applying their talent.

A friend of mine recently changed careers after a 10-year career as a regional marketing director at a well-known international chain. During her time with her former employer, she led a team of people heading up the organization’s customer-facing campaigns, including their in-store marketing campaigns. She was well known and respected for her ability to connect and collaborate with operators of branches in ensuring marketing campaigns were accepted, adopted, and successful. She had very little experience with or exposure to using technology. Lured away by an opportunity with a new and growing organization, and seeking a change after several changes in management, she is now in a new role leading a team to develop an online strategy for attracting customers, a stark contrast to her previous role where much of her interactions were face-to-face and in-person. Her new employer, knowing her background, has decided to have her lead the development and execution of their online strategy, knowing full well that her marketing experience is heavily weighted on in-person and in-store marketing. This might seem like a miscalculation or mistake on the organizations part; however, it’s quite ingenious. They recognize that our past experiences influence our perspectives on how we move forward, and that my friend’s experiences in dealing historically with customers in a face-to-face environment will actually be beneficial when developing and executing an online strategy. Having gotten to know customers in a personalized fashion during the last decade will ultimately ensure the success of the online investment.

In building out her strategy, I spent some time with my friend to assist her in making connections between the world with which she is familiar and the one she isn’t. We reflected back upon those areas that have historical significance when it comes to understanding our customers, their needs, and behaviors. I share these areas as a means for you to reflect on your own organization and the history of your customers. Whether your organization is still in its infancy or quite mature, considering the history and evolution of people as individuals is a relevant exercise to help ascertain where the organization needs to focus moving forward.

As a starting point, take out a piece of paper and consider the following areas as it pertains to your customers and the changes in how they think, act, and behave.

Generational differences: What are the typical ages of your customers, and specifically, what are the distinctions in how each generation behaves? Consider that Baby Boomers are much more comfortable making purchases in person or over the phone, whereas Millennials predominately prefer and are more comfortable with making purchases online. By identifying the distinctions in each of the generations that make up your customers, you can bring significant clarity to what has and continues to change relative to your customers’ needs and expectations.

Decision-making preferences: How are your customers making decisions today as compared to a decade ago? Customers today research everything online and through various social media platforms prior to drawing a conclusion. Research often includes entering search words or key phrases into search engines such as Google (this has become so engrained in society that “Google it” has become an acceptable phrase in the English language—look it up!), as well as asking friends and acquaintances on various social media channels about their experiences and feedback. In effect, decisions today rely much more heavily on untrusted sources than on a close group of friends or past relationships.

Communication preferences: The preferences in how we receive and send communications have changed significantly. In this consideration, venture beyond simply looking at the preferences of each generation and consider geographical region, the availability of technology, and the influence of social and economic factors. Consider that print advertising and communications are much less prominent in some parts of the world. Last, consider the influences that technology has had on the three primary means of communicating—namely, visual, audio, and kinesthetic.

Attention span: What is the average attention span of your customers today as compared to a decade ago? How have any changes in this area influenced their ability to connect with your marketing campaigns, tolerate your customer service response times, or find relevance and satisfaction in your product or service? If you haven’t already found it, you might want to check out the study conducted by Microsoft where they measured and compared the average attention span of people back in 2000 at 12 seconds, and doing the same test in 2013, only to find that attention spans had diminished to eight seconds—one second less than a goldfish.

Community: Another consideration I have my clients reflect upon when identifying changes to their customers is the influence of community. Consider that in the early 1990s there were few cell phones in use by the general public and the Internet was in its infancy. People who were physically present around them were the ones influencing customers, including their family, friends, neighbors, and coworkers; ideas on what to purchase and who to buy it from were based on this close-knit community. Today, our community is different. It’s not uncommon to have several hundred friends on Facebook (a community that you custom build based on the friends you connect with and the pages you like), most of whom you may never have even met. The decisions we make today on what to purchase and who to buy from are mostly based on this much larger community of weaker relationships, and as a result, our buying decisions are more broadly influenced.

What you will find by working through this exercise is that there have been and continue to be significant changes that influence how and what your customers buy, the products they prefer, and the brands they support. The fundamental needs of customers haven’t changed (remember, there is nothing new under the sun), which is an indirect outcome of this exercise. Our customers still purchase goods, they may just wish to purchase them in different ways; they still make decisions, but differently than they once did; they are still influenced by the thoughts and opinions of others, but where and how they solicit these opinions has evolved into larger communities, which include online communities rather than just the community in which they live or physically participate.

By completing this one simple exercise, you now have the foundation for what is necessary to begin to build a plan of growth for your organization. It’s by reflecting on the changes in people that you have now clarified what you may be doing or not doing that is (or isn’t) influencing your customers’ decisions to test and purchase your products or services. The needs of today’s customers are actually the very same needs of customers from several decades ago, which are closely connected to the needs that were outlined in Maslow’s hierarchy of needs back in 1943.² What has changed, however, is how customers seek out, assess, and decide upon how their needs will be satisfied.

Why Doing More Doesn’t Grow Revenue

Last year, I was hired by a distribution company to give a kick-off talk to their sales and marketing team. When I met with the CEO, who had started the business some 30 years ago, to discuss his perspective on the organization’s challenges and determine how we might best position and structure the talk for maximum effectiveness, it became clear what the underlying problem was. Sales and revenue had been relatively flat for several years, and as a result, the CEO and his executive team had brought on new product lines in an effort to boost sales. Selling more products to existing customers seemed like a good idea. Unfortunately, however, sales of the newly introduced product lines had been minimal, while sales of the existing longstanding products were continuing to decline. The CEO was in a panic.

I had a sense initially about what the problem might be. However, I set about interviewing several of the sales, marketing, and customer service staff to obtain their ideas and feedback. My hunch was validated.

The company had never completed the exercise I shared with you earlier of looking at the changes in their customer base through the past several years. Rather than address the underlying issues surrounding their decline in revenue (for example, relevance of products, evolving buying practices, shifting customer needs, and modified decision-making influences), they instead took what appeared to be the easiest route to growth by increasing the size of their offerings. Surely if customers didn’t want to buy existing products, they might be interested in other products?

The CEO and his senior executive team made a few critical errors in this situation, which I set about to correct. First, they never consulted with the employees who were facing customers to discuss and assess ideas on how to overcome the declining sales (their reasoning was that they feared it may spook their employees into leaving the company). Second, they listened to a sales “expert” who suggested they already had customers with existing relationships; therefore, their best approach was to offer new products. Third, they decided to take this approach because they saw it as the quickest solution to overcoming their problem.

I see this kind of “throw it at the wall to see what sticks” strategy being deployed all the time. Employees are sheltered from the issues for fear of scaring the good ones away. In turn, someone in the executive team makes a decision with very little counsel to take the fastest and least disruptive route possible while giving little consideration to history or how they might have gotten to their current state in the first place. This is the power of letting history inform the future. When we reflect on these shifts in influences on what makes customers buy, most organizations have decidedly tried to do more, which in many cases only serves to further diminish focus and efforts to achieving growth. Ultimately, the idea that “more products equal more revenue” is a false perception, and often results in more equaling less.

The idea of adding new product lines to drive more revenue and offer more products to existing customers might make sense in theory, but it often fails to be effective for three key reasons:

1. Customer buying preferences aren’t clearly understood, resulting in a larger disconnect between customer needs and the value that your employees provide.
2. New product lines grow the size and complexity of both your catalog and your operation, but are often introduced and managed using the same number of staff that managed the smaller catalog of offerings.
3. Employees engaged in the marketing, selling, and delivery of such additional services are forced to shift from intimately understanding their products and customers to becoming a clearing house for a plethora of items that no longer hold relevance or priority in their mind.

You may notice a theme among these three points. If we consider our earlier discussion on how customer buying and decision-making preferences have changed, it becomes obvious that today’s customers having greater demands about their own personalized needs. You needn’t look any further to see this in action than your local grocery store. Look at the variety of products that exist on the shelves. Where there were once two types of Coca-Cola products—Coke and Diet Coke—there are now these products as well as Coke Light, Coke Zero, Cherry Coke, Coke with Lime, Caffeine Free Coke, Coke Life, and on and on. In order to satisfy growing customer preferences for individualized and specialized products, the biggest brands have resorted to providing more and more options. However, additional products do not typically result in higher profit. My uncle, a long-time fan of Diet Coke, now prefers the taste of Coke Zero. As a result, his investment in Diet Coke has been redirected, but has not resulted in Coke selling more products. True, creating a new product that is in direct competition with a competitor’s product makes sense, but the expansive product lines that many companies are introducing are no longer serving the purpose of opening up a new market; rather, they are catering to individual customer preferences at the risk of losing them. Using my uncle as an example, it’s the “suggested” additional health benefits to drinking Coke Zero that lured him away from Diet Coke, not a competitor’s product.

This is a key realization when it comes to growing revenue because more products create greater complexity in an organization. It means, for example, that those working in sales are responsible for pitching more products (which means they need to be intimately knowledgeable with more products). Manufacturing has to produce more product lines, resulting in more raw materials, more WIP (work in progress) inventory, more changes in product processes, more training for staff, and so on. Adding more products and features is at the core of the “throw it at the wall to see what sticks” strategy. Yet in doing so, we often detract from the very essence of what makes a customer buy in the first place, and indirectly doing so often creates greater complexity in an organization, which makes it more difficult to be good at what we do.

Based on our discussion above, then, how can an employee create and sustain a personalized interaction when they are consistently dealing with new customers, more products, and greater complexity amongst the depth of those products? The reality is “more” only results in less:

More products to market often result in employees focusing on a volume of activities rather than targeted campaigns that hone in on customer value.

More products available to sales personnel reduce time available in the sales process for understanding and personalization, and instead, shift the sales processes toward a demonstration of product volume.

More products that require production create a higher margin of error for production staff in managing a broader catalog of products, all with their own unique production processes and instructions, thereby diminishing quality.

More products for distribution often results in increased error rates in shipping, greater shipping costs (for example, expediting to account for shipping errors or delays), and a lower fill rate per transaction. When faced with this type of environment, most employees simply resort to what they believe their only option to be—push volume.

The ability to successfully grow a business of any size and in any sector requires consideration of the customers who purchase the product or service, but just as importantly, a consideration of the people who support its success. Taking an approach toward growth by focusing on adding more products, more features, or more services results in employees often resorting to the “throw it against the wall to see what sticks” approach, which diminishes the customer’s overall experience.

If you’re looking for a simple test to confirm whether your employees are stuck in this approach, try the following:

1. Ask a small group of customers for their preferences relative to ensuring the best possible buying experience. Incorporate questions that determine how clear they are on what products you currently offer; how responsive and personalized your company’s approach to selling is; satisfaction with the receipt and application of the product itself; and the ease of access to your employees in the event of questions or issues with the product.
2. Using the same questions, speak with employees in various parts of your business to determine their perceptions on your customer’s responses. In essence, uncover how aligned your employees are with the feedback from your customers.
3. Lastly, assess the gaps between responses to determine where the greatest issues might lie. For example, are sellers focused more heavily on pitching products than they are in understanding customer needs? Are employees providing a personalized experience when faced with customer inquiries?

For bonus questions and other supportive materials, make sure to visit www.unstoppableorganization.com.

Just as our customer’s buying preferences have changed, so too has the world around us. In essence, it might seem like offering more products is the best approach to capturing more sales and more revenue, until we understand the influences this approach has on directly satisfying customer needs through our employees. So if more products and services aren’t the best approach to creating sustained organic growth, you might start to wonder if focusing on fewer products or services is the better choice. It’s not.

Blending Old With New: Why Traditional Approaches Alone Won’t Work

During the past several years of consulting with organizations on how to become unstoppable, I’m often faced with pushback on introducing new methods of growth. In my experience, many CEOs and executives have achieved success in their organization by predominantly focusing on a single successful method, be it a high quality or unique product or service; a strong brand promise supported by effective marketing campaigns; proven effective selling strategies and tactics; or highly responsive and knowledgeable customer service. It’s not uncommon to find a couple of these at play at the heart of a successful company, but I’ve yet to find the existence of strength in all of these areas. What this means is important because it influences the organization and its leadership. Where a company has had success that can be tied back to a specific approach that was used in the past, the leader of the organization and often much of the management team falls prey to frozen thinking. This type of thinking limits the ability to see new solutions and creative ideas that can yield new and different results—often necessary as customer needs and demands have changed, resulting in a slow diminishment of customers, sales, and revenue.

If having strong in-print marketing campaigns yielded the most leads during the early years of the business, then it is often believed that continuing these types of campaigns are the cure for diminishing revenue.

If a proven sales process once produced the largest quantity of new business, then it is often believed that any loss of customers or revenue is the result of the process not being effectively followed or applied.

If a responsive and knowledgeable team of customer service representatives were what customers in the early days of the business raved about, then any diminishing revenue must be tied directly to poor customer service.

In every instance of this frozen thinking, it is employees who are often considered the primary point of blame for not “following the process” or “for taking matters into their own hands.” As you can imagine, once this perception reaches employees, their morale diminishes, which only serves to further exacerbate the problem.

Just because something worked once doesn’t mean it will continue to be as effective. Remember, the purpose of history is to inform the future, not create it. That’s the lesson, and breaking through frozen thinking is the first obstacle to opening up the possibilities for what needs to change in order to meet shifting customer needs and demands. After all, it’s rare that I’ve come across a CEO or executive who doesn’t think their customers have changed, yet they and their teams are often still relying on practices or approaches that were effective in the past rather than exploring what might be working in the future.

Traditional approaches are not completely ineffective, nor are they wrong. What’s important to recognize is that as with the preferences of our customers evolving, influenced by a variety of social, economic, and technological factors, so too do our approaches to growing an organization need to change. Just because something worked once doesn’t mean it will automatically work again; in fact, it is highly unlikely that it will work if applied in the same method again. Here are some examples I’m sure you can relate to:

Marketing strictly through print ads or only online will yield fewer leads than marketing through a combination of the two strategies.

Selling using face-to-face strategies, or only through using online methods, will be far less superior to generating and closing business than a combination of the two approaches.

Manufacturing goods while following lean practices, without considering technology, Six Sigma, or a variety of other proven production improvement methodologies will yield lower throughput and diminished productivity.

The key is to blend approaches, and the way to determine what of the old needs to remain versus what of the new should be created or introduced comes from assessing your customer. If the demographics of your customers has shifted and more of your buyers are using the Internet to shop, adding a shopping cart and possibly supportive chat functions on your Website makes sense. However, keeping traditional selling methods that were historically effective with older generations is also crucial to sustaining your business.

One of the best examples I can give you of recognizing the effectiveness of blending the new with the old is cold calling. Once an effective means of finding leads, cold calling is now considered dead by many. This is true if you apply cold calling in its historically acceptable application. The advent of technology, such as caller ID, has made it more difficult to get people to pick up a phone, never mind generational differences in customers who are often more hesitant to answer the phone today anyway. If you blend a historically effective selling strategy such as cold calling with newer technology, and contrast it against customer buying preferences, new and more effective strategies emerge which can help warm up the cold call and ensure a higher response rate.

For example:

• Calling to follow up on an e-mail inquiry submitted online.
• Calling to follow up with customers who purchased a product online.
• Calling to follow up based on an e-mail introduction from a referral source.
• Calling as a follow up to an e-mail sent at an earlier time.

For years now, some of the most iconic brands have been applying this blended approach. Nike and Apple blend their historically strong retail presence with strategic sales channel partners, complemented by an online presence allowing their customers a multitude of options when it comes to seeking out and purchasing products.

The need to blend the old with the new comes not only as a result of changes in our customer buying and behavioral preferences, but also as a result of these very influences impacting our employees. Although these influences might manifest themselves in different ways when it comes to our employees, understanding their influence is key to assessing how to effectively blend traditional approaches with more modernly accepted ways to grow an organization.

Employee Intelligence: The Unknown Secret to Growth

It’s one thing to recognize that our customer buying preferences have evolved and changed, but it’s another to recognize that many of these changes have also been adopted by or influenced our employees. As a result, attempting to direct employees in marketing, sales, or customer service to use practices that no longer work or seem irrelevant can be further detrimental for growth.

While delivering a speech to a group of CEOs on empowering customers, I asked the audience what methods of customer communication they found were most challenging. One CEO of a privately held business spoke up quickly and said, “Shawn, this texting thing with customers, it is absolutely outrageous.” At first, I took his statement as a positive response, so I asked him to continue. It turns out that by “outrageous,” what he meant was “ineffective.” When I asked him to elaborate, he shared that many of his sales personnel liked texting their customers. It turns out that in one instance a customer had misunderstood a text message, and had taken their business elsewhere. As a result, the CEO had instituted a policy of no texting allowed.

That’s right, as a result of one misunderstood text (out of literally thousands) not only did the CEO decide by himself to limit texting with customers, but he applied a blanket policy across the organization to completely ban texting with customers. Surprised at his response (as were several others in the room, confirmed through their chuckles and whispers), I asked how the policy was holding up. “Not well,” he proclaimed, “it seems the only person following the policy is me, and none of my managers want to police it.”

I don’t care what kind of business you have; texting, chat, or instant messaging is here to stay. If your customers prefer to communicate in that manner, you’d better find a way to make it happen unless you prefer to lose them. Here is what I said to the CEO: one bad customer experience should never equate a change in policy, particularly if that policy limits or detracts from how your employees interact with or support your customers. Once you use policy to institute a change, you detract from your employees’ ability to think and act responsibly and with common sense.

I don’t recall what the exact issue was with the text message that irritated the customer, but the CEO’s response was unwarranted. It’s unrealistic to believe that an accepted form of communication that both your customers and employees feel comfortable using should be restricted on account of one person’s poor judgment or misinterpretation.

Herein lies another secret that every unstoppable organization has realized. Policy and procedures, although meant to drive consistent behavior and results while avoiding repeatable problems, limit creativity and slowly erode employee morale and engagement. Think about that for a moment; an abundance of policy and procedure is actually an obstacle to growing a business and its revenue because it turns employees into robots. The more we tell people what to do, the less they have to think. This results in employees who wander through the days acting like robots. I’m not saying this to insult the employees, but you and I both know that growth of an organization, built on attracting new customers and keeping existing ones, comes from your employees’ ability to satisfy the individual needs of customers.

If you agree that our customers’ needs and demands are changing, then our employees, who are also influenced by the same environmental factors, are also changing. As a result, tapping into the intelligence of our employees, such as their knowledge of how customers prefer to communicate, their understanding of the shifting needs and demands of customers, their insight into the weaknesses within our products, services, or customer interactions, provides the ideas, information, and opportunities to build a stronger and more collaborative interaction with our customers. I like to think of employees as an organization’s secret weapon to growth. How you apply that weapon is the key to long-term success.