By Drew Stevens
August 6, 2009
It is the best of times; it is the worst of times-immortal words written by Charles Dickens over 200 years ago. Numerous businesses are struggling with both profits and productivity. While the current recession weighs heavily, many organizations are doing well despite the storm. There are a myriad of reasons for success, and the most pragmatic is that even during economic turbulence, products and services are still required.
So how can organizations rise from the economic quagmire? What are things that can be done to be successful and what might be done for a longer future?
First, it is imperative to understand that 90 percent of the economic wealth within the United States stems from small business. Entrepreneurs are the economic backbone to our society-not complex business. However some fail and some achieve because they follow five very practical principles that lead to lasting growth.
Many years ago, the management guru Peter Drucker stated that there is only one reason that organizations are in business-the customer. The customer is the focus for everything; sales, marketing, research and development, even finances. Successful organizations such as Southwest Airlines and FedEx know their most imperative asset-clients. These companies exist to fulfill the accomplishment of everlasting service and support. The best organizations refrain from short-term profitability concerns and focus on what provides the best customer satisfaction.
It costs 10 times more to develop a new client than sell an existing one. Current clients are the lifeblood of every successful business. The issue with many organizations is the focus for client acquisition and not retention. Cultivation of client relationships assists in leveraging brand and equally extending marketing. When clients discuss your firm with friends, family and peers viral marketing helps proliferate the image and extend brand.
Cultivating relationships is not difficult. First obtaining testimonials and referrals are tremendous. Clients love to gloat and allowing existing clients to share success stories is wonderful for building relationships. Second, ensure instant success by expressing your gratitude for their patronage. Thank you cards illustrate your fondness for clients, especially when they are handwritten. Refrain from bromide tactics of competitors, electronic media show laziness while a handwritten note remains on a desk for months.
Third, get to know your clients. Understanding their personal and professional issues as well as some family history assists in establishing rapport and building relationships. People simply enjoy doing business with those they know and trust.
Customer relationships must be harvested over time. However, once the fruit of the relationship blossoms, clients enjoy your company. When clients are at the emotional precipice that is the time to request and nurture referrals. There is no better remedy to selling gaps than the receipt of a referral from a satisfied client.
Strategy is the framework that guides those choices that determine the nature and direction of an organization. These choices relate to the scope of an organization’s products, markets, key capabilities, growth, ROI and allocation of resources. These are vital concepts simply because too many organizations focus on the improper notion — short-term profits. There is a pressing need for organizations to become more strategic and less tactical. The rationale forces the business into the “what” mode rather than worrying about the “how.”
To encourage useful thought into building a clear and concise strategy, business owners should be seeking answers to the following questions:
1. What is the thrust or focus for future business development?
2. What is the scope of products and markets that will and will not-be considered?
3. What are the future emphasis or priority and mix for products and markets that fall within that scope?
4. What key capabilities are required to make strategic vision happen?
5. What does this vision imply for growth and return expectations?
In addition, the Driving Force is the primary determiner of your organization’s future strategic vision determined by one of nine key variables. These include:
Products and Markets
-¢ Products Offered
-¢ Market Needs
-¢ Production Capability
-¢ Method of Sale
-¢ Method of Distribution
-¢ Natural Resources
Without a strong vision and direction for the business it is doomed even prior to launch.
History proves that recessions are the best times to increase the market’s awareness and perception of your products and services. One the gravest myths about recessions and unfortunate business practice is the act of retreat. Many organizations decrease spending, tightly control budgets and count the numbers of used pencils. This only wastes time and decreases access to markets and customers.
Recessionary times call for aggressive measures and one of the best tools when others are retreating is to increase marketing. As competitors tightly control advertising to balance profit streams, a recession is a great time to overtake ridiculous budget habits. Fortune, The New York Times and Kraft all built recognized names by advertising and amplifying marketing during turbulent times. Assuming that your organization has worked long and hard at building name and brand, now is not the time to forsake it, but to make it last forever.
Nothing Happens Without a Sale
Too many entrepreneurs become complacent after opening a business or begin a business believing the notion, “if you build it they will come.” Not true. All businesses require a complete focus on selling. Nothing in the business exists unless something is sold. Utilities and salaries do not get paid and little if any revenue becomes available for research and development.
Entrepreneurs need to develop strategies and successes for achieving selling excellence. The ideas include self-development and more importantly the realization that everyone in the organization must be involved in the process. Selling requires the communication and coordination of the entire organization.
One For All and All For One
The final principle of success in every business is the ability of all involved working to fulfill the needs of the organizations most important asset- the customer. Forty-five percent of every client interaction involves customer service and support. It is imperative for all companies to follow the rule of the Three P’s - People, Processes and Physical Evidence. Make certain the organization hires the right talent and that employees are focused holistically on the customers. Develop processes that are easy and allow for little encumbrances to resolving customer issues. Finally, ensure the physical evidence from collateral materials, to parking spaces and e-mail signatures encapsulate and articulate your brand and your devotion to high-level customer service.
The road to excellence is not difficult. Yet many twists and hurdles disable your intentions and produce impediments to success. The best organizations understand the need for a clear vision, have created strategies to circumnavigate the issues and remained focused on the customer. If your organization is moving astray, review the five secrets, make a 30-day plan, create some action and watch your margins and success soar while decreasing labor and stress!
Drew Stevens, Ph.D. helps organizations accelerate business growth. He is the author of Split Second Selling and is the president of Stevens Consulting Group in St. Louis. He can be reached at http://www.stevensconsultinggroup.com or his blog http://www.drewstevensconsulting.com.