The purpose of creating a business is to sell it. When it comes time to sell, you want the success of your business to be dependent on systems and not on you. Therefore, you must work on your business as well as in it. You always want to keep the big picture in mind and not get immersed in the details. How do you approach this? Develop systems to enhance it.
There are just four ways to grow your business:
1. Increase the number of customers of the type you want.
2. Increase the frequency with which they deal with you.
3. Increase the average value of the sales transaction.
4. Improve the effectiveness of the processes in your business.
Remember that one of the four reasons for being in business is to have fun.
Your business is there for your benefit; you are not there for its benefit.
What you can measure, you can manage. If you are not measuring a process, it is almost certain that you are not managing it. Think about your business and what makes it profitable. Are you measuring these processes?
• How many customers do you have?
• How many new customers did you get during the last month and the last year?
• What was the source of these customers?
If you and your team are doing activities that you cannot measure, then the chances are that those activities are adding no value. If they are adding no value, why waste your time doing them?
Build your Unique Core Differentiators (UCD’S). This information bulletin is part of our UCD’S. What have you got?
Look for a second dimension in selling your product. Extended warranties, companion selling, etc.
Learn to really listen. Don’t prescribe a solution unless you really understand the problem. Cutting the price is the easy option - but there is often a better way. It will be harder, but you will earn more money and add more value to your business.
Lower the barriers to doing business with you. Some businesses still do not accept credit cards. (Have I hit a sensitive nerve here?) Should you be taking debit cards?
The more specific things you can tell, the more you can sell. What are the reasons your customers deal with you? Tell these reasons to others and see if you gain new customers.
Avoid changing horses in midstream. If you have tested or measured a system or a process and it works, stick with it until you develop an improved system or process.
Know the power of one. Direct your efforts to one customer or to one prospective customer who requires your service or product; don’t direct your efforts to those who don’t require them.
Learn the value of discovering key frustrations.
Systematize: have a specific way of doing every thing.
Set performance standards: have a best way of doing things.
Invert your pyramid and empower your team. The team you have in place can solve most day to day problems. They can do it faster and more effectively than you can. You just need a way of identifying the solution and applying it. Give them the skill and the authority.
Don’t just reverse the risk, remove it. If you give guarantees, you must have systems in place so that the only result will be the one where you will meet your guarantee.
Give your team a clear and detailed action plan. Be pro-active in following up on orders.
Create offers to add value and to encourage faster responses. If offers increase responses considerably, why run an advertisement without an offer?
Add a 3rd dimension to marketing your product. Consider a Host Beneficiary program. Who else is serving your customers? They want access to your customers. You want access to theirs. Find a way to work together to benefit both.
These ideas will only work if you implement them. As the Nike people say, "JUST DO IT!"
Showing posts with label Measure. Show all posts
Showing posts with label Measure. Show all posts
Tuesday, June 12, 2007
Monday, June 11, 2007
Great Expectations Get Great Results
Remember the Gulf War? Remember "Stormin' Norman" Schwarzkopf, the American general who became a hero? Many interesting things came out of that, not the least of which was stories about some techniques Schwarzkopf used. They are the same techniques you and I can use to get things done.
One of the most succinct examples concerned Stormin' Norman and his experience when taking command of helicopter maintenance early in his career. He'd ask how much of the fleet could fly any given day, taking into account maintenance schedules. "Seventy-five percent" was the reply. Wondering why it wasn't 73% or 74%, but always 75%, he decided to set a NEW standard. "I don't know anything about helicopter maintenance, but I'm establishing a new standard of 85%," he announced. Sure enough, in very quick time, 85% operability became the norm. It's interesting isn't it? People perform to expectations. If you set low expectations that are what you get. Set them high, and it's truly amazing how your new level has a way of becoming reality.
Creating benchmarks - for your people and yourself - has an uncanny way of coming to pass. Let me give you a case in point. John Mitchell is a pharmacist in Stirling, South Australia. John simply set benchmarks for his team. Was it some complicated selling process? He developed a checklist to help his people identify up-selling opportunities. He gave the checklist to his team and then put up a white board where they would "chalk up" every successful up-selling transaction. It became a fun challenge for them to beat the others and achieve the highest tally for the week. His only cost for this incentive was dinner for two for the winner on his team. His reward was (and is) incredible and far-reaching! To his utter amazement, putting a performance standard on cross-selling now accounts for 50% MORE SALES value from every transaction. As he put it, he wouldn't have believed it until he saw it happen. (His profitability increase, of course, will be much, much more.)
Now take the case of Ian Stathie of Wray Owen Funeral Directors. He sent us an article from a US funeral industry magazine. In it is the most comprehensive set of performance benchmarks you can imagine, benchmarks that allow the members to strive for excellence AND measure their commercial prosperity. For example, they carefully monitor such things as the total number and value of "pre-need" insurance sales, total number of deaths that were pre-funded, percentage of embalming to total calls, percentage of casket to total calls and so on. Morbid? No, it's just sound and professional business practice.
They DON'T pay lip service to setting standards and benchmarks. They DO it and then monitor it. As the article says, "These are people who want to excel, people who want to give every family they serve extra value for their dollar - these are people who look at everything with an open mind." The truth is, too, that these people understand this great truth, "What you can measure, you can manage." Again, what you can measure you can manage. Put another way, if you are trying to manage something that you're not measuring, you've got a snowflake's chance - well, you know the rest. You have very little chance of managing it effectively.
One of the most succinct examples concerned Stormin' Norman and his experience when taking command of helicopter maintenance early in his career. He'd ask how much of the fleet could fly any given day, taking into account maintenance schedules. "Seventy-five percent" was the reply. Wondering why it wasn't 73% or 74%, but always 75%, he decided to set a NEW standard. "I don't know anything about helicopter maintenance, but I'm establishing a new standard of 85%," he announced. Sure enough, in very quick time, 85% operability became the norm. It's interesting isn't it? People perform to expectations. If you set low expectations that are what you get. Set them high, and it's truly amazing how your new level has a way of becoming reality.
Creating benchmarks - for your people and yourself - has an uncanny way of coming to pass. Let me give you a case in point. John Mitchell is a pharmacist in Stirling, South Australia. John simply set benchmarks for his team. Was it some complicated selling process? He developed a checklist to help his people identify up-selling opportunities. He gave the checklist to his team and then put up a white board where they would "chalk up" every successful up-selling transaction. It became a fun challenge for them to beat the others and achieve the highest tally for the week. His only cost for this incentive was dinner for two for the winner on his team. His reward was (and is) incredible and far-reaching! To his utter amazement, putting a performance standard on cross-selling now accounts for 50% MORE SALES value from every transaction. As he put it, he wouldn't have believed it until he saw it happen. (His profitability increase, of course, will be much, much more.)
Now take the case of Ian Stathie of Wray Owen Funeral Directors. He sent us an article from a US funeral industry magazine. In it is the most comprehensive set of performance benchmarks you can imagine, benchmarks that allow the members to strive for excellence AND measure their commercial prosperity. For example, they carefully monitor such things as the total number and value of "pre-need" insurance sales, total number of deaths that were pre-funded, percentage of embalming to total calls, percentage of casket to total calls and so on. Morbid? No, it's just sound and professional business practice.
They DON'T pay lip service to setting standards and benchmarks. They DO it and then monitor it. As the article says, "These are people who want to excel, people who want to give every family they serve extra value for their dollar - these are people who look at everything with an open mind." The truth is, too, that these people understand this great truth, "What you can measure, you can manage." Again, what you can measure you can manage. Put another way, if you are trying to manage something that you're not measuring, you've got a snowflake's chance - well, you know the rest. You have very little chance of managing it effectively.
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