Saturday
Mar232019

Real Business with Alan Wick


The "Real Business with Alan Wick" show is broadcast on the last Sunday of every month.

Some years ago, the late Steve Jobs, who as you probably know founded Apple, gave a wonderful speech to students at Stanford University at the end of their studies. In it, he advised them to “Stay Hungry. Stay Foolish.”
  
Inspired by this, I like to say “Stay Hungry. Stay Learning.”
 
I interview experienced entrepreneurs who are not only happy to share their success stories, but are also willing to talk about their mistakes, what they’ve learned from them and are still learning as they continue along their journey. Plus there’s a Reflections Section at the end, where I link their experiences with learnings you can apply to your business.
  
If you have a question or a comment, do please call my 24 hour hotline 01342 889488. Or you can email realbusiness@alanwick.com. 
  
If you end up missing part of the show, or you want to listen to it again, then go to the Listen Again page on this website.
   

I hope you enjoy the show, and more importantly, that you learn something from it that's useful for your own business.

Wednesday
Mar202019

How to win more clients

During a recent Ask Alan webinar, the owner of a B2B professional services company said she had a sales problem: she was finding it difficult to win new business. Revenues had been flat for a long time. What did I suggest?

I asked if she thought the issue was around converting prospects, not attracting enough new ones, or a bit of both. She said not attracting enough new prospects.

I explained that I call this a marketing rather than a sales issue. My definition of "marketing" in the B2B space is all activities that attract prospects to having a conversation, and "sales" is converting them into paying clients.

She went on to say that she and her team had worked hard on activities such as social media, advertising, putting on events, PR, and asking their existing clients for referrals. They had also tried networking with non-competing professional services companies, and although there were often warm words, no referrals were ever forthcoming.

I keep all microphones on during these sessions, so anyone can chip in, and there was a chorus of agreement from around our virtual table, all of whom were B2B professional services businesses of one type or another. This was evidently a common issue.

Manufacturing businesses inherently understand the need to open many distribution channels to get to their target market, such as direct (e.g. website), indirect (e.g. retailers), whereas professional services companies often do not, or if they do, they believe it isn't possible.

So I asked the participants to imagine that we were on the board of a breakfast cereal startup; we had a fantastic new product that was fast becoming popular with our online community; if only we could get it out to a wider audience. What could we do to get it stocked by one or more of the major retailers?

They chimed in with lots of suggestions: "we have to get them to taste it", "they'll need to make enough margin", "they'll need to visit the factory", "we'll have to show them we can be trusted on food safety", "they'll probably want to run a small pilot at one of their smaller stores", "they'll want to know how much we're going to spend on promoting it".

I asked "can you see what's in common about these points?" After a while they realised these were mostly concerns that needed to be overcome.

I said this is no different from the concerns a potential referrer feels when you approach them - think about how you feel when someone approaches you. No matter how impressive they seem, how likely are you to refer them to your best client?

The business coaching company Shirlaws, with whom I was involved for a number of years, arranged these concerns into five areas:

  1. Trust: will this person treat my clients like I do?

  2. Control: will they do anything to undermine my relationship with my clients?

  3. Quality: what's the quality of the advice / service like?

  4. Consistency: the person I've just met seems OK, but what about the rest of their team?

  5. Time: will I be wasting my time building this relationship?

In the same way that a buyer at a major retailer has concerns that must be overcome in order for them to stock the product, it's vital to overcome similar concerns of a potential referrer. Only when they have been overcome, will the referrals flow.

How about the other side of the equation, in other words the benefits for the referrer? In the breakfast cereal scenario, the answer's obvious: sales and profits for the manufacturer and the retailer.

However in the B2B professional services world, the answer isn't so obvious. Once again, my alma mater arranged the potential benefits into five areas:

  1. Revenue: your client spends more with you as a result of their advice.

  2. Loyalty: your client thinks more highly of you for making the introduction.

  3. Referrals: what it says on the tin!

  4. Knowledge: gaining a better understanding of your client.

  5. Protection: keeps the client relationship in the loop.

As I finished explaining this, there was excitement around our virtual table; several business owners, including the person who had asked the question, said they wanted to try this approach out ASAP and see what happens.

I hate having to throw cold water at moments like this, but I'm a believer in Radical Candour, so it had to be done: I said "this takes several meetings, usually over months, to work, so be patient. I suggest we revisit this on a regular basis over the months ahead, and see how you get on".

They agreed.

So if this is something that resonates for your business, give it a try, and let me know how you get on.

Better still, come along to one of my free Ask Alan webinars, and I'll guide you through the process.

Wednesday
Feb202019

Which came first? The Product or the Market?

After many years' hard work, a client of mine got his business up to several millions pounds of turnover; the company's profitable, cash positive, and ready to scale.

He asked me a classic question, one I'm often asked: "I'm feeling really bullish at the moment. We've developed a range of services around our core proposition, and we operate in several markets. We've got the resources to grow substantially, the wind is in our sails, what should we do: develop more services for the markets we're already in, or find more markets for the services we already offer? Come to think of it, what about new services for new markets?"

I answered "have you heard of Igor Ansoff?" He looked at me as if I'm nuts. I explained that Igor Ansoff is the man who wrote the book on strategic product marketing for growth. I added it isn't necessary to read it, just take a look at this website www.ansoffmatrix.com then let's talk again.

This he did, and at our next coaching session, after discussions with his board, he came up with a clear strategy that suited his business.

The reality is there's no right or wrong around the order of play between Product vs. Market.

Each situation is different, and each company's management has a different attitude to risk (have you measured yours?), so each requires a strategy that's right for them.

What's essential though, is to have the best framework to assist with this crucial strategic question.

In my view, nobody beats Igor Ansoff in this area of business thinking.

He died in 2002, aged 84, after decades contributing to business management thinking. He's known as "the father of strategic management".

What a legacy. Thanks Igor.

Sunday
Jan202019

Whose Agenda Is It Anyway? Yours or your customers?

During the Global Financial Crisis, I noticed that some companies suffering from declining revenues decided to go for almost any business from anyone in order to survive. This approach usually produced short-term relief but hurt them later.

For example, a premium software development company that suddenly lost its largest client made no cost reductions, discounted its fees, and ended up in a vicious cycle leading to its eventual demise.

On the other hand, companies which doubled down on their core offer, reduced costs (including making redundancies), often weathered the storm and survived.

I remember one company particularly well that took the second approach.

It was a well-established family owned business that recycled corporates’ unwanted IT equipment. Over the years it had built a dedicated team with a really positive "can-do" culture. They all cared passionately about their environmental and social responsibility values: when I asked what they were proudest of, they said “the year we sent the most containers in the company's history of revived IT equipment to Africa for free”.

The company’s Positioning strategy and branding reflected this perfectly. But during 2009 orders were thinning and they were heading for trouble. During a workshop I asked them to articulate as succinctly as possible why their customers chose their company over their competitors.

It turned out that their Positioning strategy, which had served them brilliantly during good times, focused on their environmental and social responsibility values, whereas the main reason their customers chose them was they received more money from them for their unwanted IT equipment than from their competitors. In other words, the cold hard reality was that their company values were a “nice to have” not a “must have” - from their customers' perspective.

During the workshop they came up with a new Positioning strategy that focussed on the “must have” part of their offer. This was a painful process for them, as the founders had started the business from a purpose-led point of view, with the commercial side supporting it (which may sound odd to some people). But they realised they had to adapt to the new environment or, worst case, lose their business.

From that point, it was a relatively short journey to creating a new brand that articulated their new Positioning strategy. When I say a new brand, I’m not referring to new corporate colours or a new logo. They actually changed the trading name of the company to one that “did what it said on the tin”.

In these situations, I always advise clients to avoid the temptation to "badge then build". A congruent re-positioning strategy is the exact opposite: "build then badge". I.e. implement the hard yards of changing operationally - however long that takes - before "badging", otherwise they'll fool no-one. If you're interested in learning more about this topic, here's a terrific article by ex-Netflix marketing guru Barry W. Enderwick with real-world examples.

In this case there was no need to change their operations or processes. They changed their marketing messages across all channels, and they commissioned training for their sales team to focus on the commercial benefits of choosing their company, in parallel with the rebranding exercise.

In a matter of months, my client's revenues started to climb. Their sharp, straight to-the-point message landed with their target market in a language they could relate to. In other words they focussed on their customers' agenda rather than their own.

At the end of the project, I wondered whether, when the GFC ended, they’d revert to their previous Positioning and associated branding.

They didn’t.

So, my question to you is: looking from the outside in, does your company’s Positioning strategy suit your agenda or your customers agenda? If the former, why?

Thursday
Dec202018

How to gain customers even if you make a pig's ear of it.

Many years ago, I worked with a client who ran a five-star hotel in an exclusive part of London. Running a business in that area was very competitive. One of my client's key metrics was measuring the percentage of guests who returned. So, he decided to focus on what he could do to give the best quality service. He did all the usual things you’d expect: getting the phones answered quickly, delivering room service in good time, staff polite and well-presented — all that type of stuff.

Over a number of months of measuring the results, the hotelier began to notice a very strange trend. When something had gone wrong during the guest’s stay, for example a missing bar of soap or a missing remote control, if the hotel went above and beyond what was expected – those guests were more likely to return, than if something hadn’t gone wrong in the first place.

The hotelier found this discovery weird — counterintuitive — and that made him curious to put it to the test.

Over the following months, he started playing around with various scenarios. One scenario would be to get his staff to deliberately remove one remote control from a suite but not the other, so when the guest arrived, they would call housekeeping.

Housekeeping would come to the suite, apologise for the mistake and provide the missing remote control. On one occasion (and this is a true story) the hotel arranged for a chauffeur-driven car to take the guests to and from the theatre they'd booked through the concierge.

Naturally the guests were super-delighted with this. They went on to return to his hotel over and over again, told their friends what had happened, who in turn booked rooms there.

The hotelier continued these experiments over a year or two, training the hotel staff that when things go wrong, they should do more than apologise and put it right. He gradually introduced a budget for housekeeping, which staff could allocate for this purpose, giving them authority to use their best judgement. The results were undeniable: the hotel developed the highest occupancy rates in the area, with a loyal following of returning guests who chose to stay at his hotel year after year.

Thus the hotelier learned to increase customer loyalty by doing more than is expected to put something right. This concept has a name: "Service Recovery".