Good to Great in Business

Written by: Alan Rodway - Your Coach Online

Taking a business from Good to Great is difficult … but staying there can be even more difficult.

Clarity and alignment of stakeholders’ goals is critical for sustained success. The objectives of equity holders, (key) internal personnel and customers must all be aligned.
What is the future market for your product? Not the demand for today, but the demand in future (say, over the next three years)? If there is solid predicted demand for your product, great. If not, you need to change the product offering. Greatness is partly achieved by prediction and foresight.
Know the game you’re in Village figured out they were best to be in the ‘time out’ game rather than in the movie game and successfully created Gold Class. Apple figured out they could be in the personal technology game (rather than the computer or phone industry). McDonald’s chose to be in the ‘fun for kids’ industry and not the food industry. Australian Rules football figured out they were in the entertainment industry rather than in the sporting industry. So, what game are you in and what implications does that have for how you run the business?
The importance of Why, as distinct from the What and How . It is absolutely crucial for a business to communicate Why they exist to their customers BEFORE they communicate the What and the How. Why should you do business with us? And then take the customer into what you provide and how you provide it. Apple do this brilliantly … ‘We make your life better’ … then the customer is led to ask about how and the what … being easy to use, high technology, reliable, fun products. The buying motive is already established. Most businesses communicate the What and the How first and leave the customer with the Why, and that becomes a 50/50 proposition as to whether the customer goes ahead with the purchase.
What implications does disposability of product have for your business? So many products are now disposable so businesses have to adjust their game for that. There are either no resale values of used goods or much lower than for previous years. The repairs market, across so many industries, has gone .. recycling has replaced it.
Greatness is about asking the right questions … and keeping them alive until the answers are found or created. Greatness is often created over a period of time, not in the immediate short term … so holding the right questions until the answers are found, is pivotal.
Some wonderful quotes help … “Greatness is defined in moments of crisis”, “If there’s more change going on outside your business than inside your business, you’re going out of business”. “Great spirits have always encountered violent opposition from mediocre minds” (Albert Einstein). “Deciding what not to do is as important as deciding what to do” (Steve Jobs).
An acid test question for greatness: What major change(s) have been instituted in your business in the last twelve months? If the answer to that is ‘not much’, history will warn you about the future.
How would you like to be running your business in three years time? Note the words ‘like to’ not ‘probably will be’. Design that and bring it forward into the next twelve months.
If you’re in business, then that word itself is from ‘busy ness’ .. the art of being busy. That never achieves greatness; it just gets another day’s work done (and that makes no difference to anything in the longer term). Greatness comes from decisions and thought, not work.
When an business makes important decisions, those decisions are best made with input from a cross section of people : younger and older, experienced and less experienced, conservative and ‘can do’, male and female, industry based and non industry based, even different cultures.
Greatness in business has to get across the ‘price’ issue . It’s not (always) about price or being the cheapest; it’s about value. And, ‘price per what’ is powerful .. price per kilometre for a car purchase, price per copy for a photocopier purchase, price per year for a house purchase, price per spray for a perfume, etc. Expressing prices in these terms gives a way more powerful (and palatable) aspect to pricing than just debating the price itself with potential purchasers of a product. Further, being expensive is often an indicator of something special .. quality, exclusivity, scarcity .. so competing on price is not always the way to go for the future. Of course, higher prices have to have validity behind them in the eyes of the purchaser (real or perceived).
Deep and broad competitor information . It is difficult to beat what you don’t know. So, what information flows is your business receiving about competitors and how often?
Put together customer lists, from highest income to the business to the lowest , even though it will number many thousands in some cases. Then, in a side column, set up a formula that shows the percentage of total income received as you move down the list. Most businesses will be surprised by how little from the top they have to go down before they reach an accumulated total income of say 30% to 40% of total income. Then ask how much of the business’s time and effort is going into that upper echelon of customers / clients (I suggest that it will be less than it should be for many businesses). Then do exactly the same from the bottom up and most businesses will be equally taken aback by how far up the list they have to go to reach that same 30% to 40% of total income … as in, a long way up! Then ask how much of the business’s time and effort is going into that lower bracket (I suggest it will be too much for many businesses). The point is obvious … greatness will never be achieved by under resourcing attention to the top customers / clients and over resourcing attention to the bottom level . Yes, that’s the pareto principle …. but too many businesses do little with it.
What can you do to attain one more of your top level customers / clients? Because if one person or entity is prepared to pay you that much, chances are that another exists somewhere that you don’t now have .. so what do you need to do to secure them? Further, what else can you do to generate referrals from the top echelon of your customers / clients … because they are the ones who probably best fit your demographic and are most likely quite satisfied with what you’re providing to them, to be at the level they are. So, interact with them in ways that will generate recommendations to other potential high level customers / clients.
Highly effective use of your database and CRM . These are the easiest roads to higher revenue for least cost.
Be clear on its target customer , meaning it has to be in writing, listing specific criteria, with everyone in the business aware of it all (and embracing it through their behaviours). Activities and behaviours can then be designed to source the targets, keep the targets, grow the targets and get the targets to refer in others. Beyond this though is also being just as clear on what is an ‘acceptable’ customer .
Measure, measure, measure . It is difficult to change or improve what you don’t measure. The gathering of information always entails a cost so the measures we use should be those that have a positive net benefit. Also, distinguish between ‘causes’ and ‘outcomes’ in your measurements.
Set up ways to create relationships with customers, suppliers, the community and within your business between colleagues . Connections cause further interactions; mere exchanges don’t.
Implemented knowledge is power . So, ask the question of your own business … “What knowledge do we gather and how do we use it, over time?”
The social media is a must for most industries. The social media is cheap, massively broad in coverage, instantaneous and can be easily run.
Greatness is aided by outstanding use of the internet … and this is more than just maximizing your website. Too many businesses are guilty of not knowing what they don’t know in this arena.
Greatness can come from being one of three things: Big, different or boutique . This principle applies to online businesses as well.