Archive for the ‘Creating New Product and Services’ Category

“Companies in the rich world are confronted with a rapidly aging workforce. Nearly one in three American workers will be over 50 by 2012, and America is a young country compared with Japan and Germany. China is also aging rapidly, thanks to its one-child policy. This means that companies will have to learn how to manage older workers better. It also means that they will be confronted with a wave of retirements as the baby-boomers leave work in droves.” (Source The Economist)

So what does this mean for decision makers like you? Two issues. First, in terms of rising up the management ladder, great opportunities are available for innovative thinkers who continually self-educate and build upon their leadership strengths. Are you armed with the right and best mental tools, processes, education, skills, etc. to be able to go beyond the basics of leading and managing others? The winners of tomorrow are building their management ‘tools kits’ today, because they know that in tomorrow’s world even more so than in today’s, they’ll be forced to CREATE opportunities, not just capitalize on existing ones.

Second, in terms of succession planning and building current leadership teams within today’s organizations, the aging workforce means that you’ll have fewer qualified candidates from which to fill open leadership positions, so you need to start  building the leaders of tomorrow now rather than expect to pull these candidates from the currently fast-evaporating pool.  What systems and processes do you have in place to hire the highest-potential candidates, empower others to work independently, achieve results through others, and most importantly, to attract prospective leaders who THINK in ways that capitalize on and create new opportunities?

This issue of the aging workforce–and specifically, the aging leadership force–doesn’t have to be a negative challenge. In fact, taking steps now can give you great advantages over two kinds of competitors: individuals who are vying for the same job positions as you are, and organizations that your organization competes with in the marketplace. In a nutshell, begin with acquiring mental management tools for yourself and then teaching them to others. Here are three examples to get you started:

1. CPM and Ghantt charts that help leaders organize projects, inform and direct the activities within projects on a time line and according to budget, and keep projects on target for completion as planned.

2. New product and service development tools which help you in the selection of best product/service ideas and pull together cross-functional groups to provide input and support throughout the development of the product and service to outpace competitors.

3. Strategic planning processes that structure the ways in which you and your leadership team(s) strategize to move your organization forward not only today, but into the future.

Of course, you probably already have some ideas floating around in your head about other options, too. The key is to formulate a plan and act on it now. Don’t wait, the opportunities arising from the aging-workforce issue are here for the taking.

When I was a kid, sitting down to have a bowl of Cheerios was not an uncommon breakfast meal.

What we’d do is pour a bowl of PLAIN Cheerios and then sprinkle, or should I say dump, sugar all over the top to sweeten the cereal.  Most of the sugar fell to the bottom, so we’d scoop up what we could in the last few bites. So many kids did this!

Last week, I opened one of our kitchen cabinets and discovered a new product that brought back this childhood memory…General Mills’ Frosted Cheerios.  I believe an eternity has passed since my days of pouring sugar on Cheerios, and now finally, pre-sugared Frosted Cheerios have made their way onto store shelves…even at a time when consumers are looking for natural foods.

Think about how this “new” product has been sitting smack in front of management for years and years and years.  Sometimes you don’t have to look far to find new products, product extensions, product improvements, etc.  You just have to keep your eyes open.

Have you considered what your organization’s order qualifiers and order winners are? Nearly 3 decades ago, London Business School professor Terry Hill introduced the concept to manufacturers, describing qualifiers as basic characteristics that an organization, product or service needs just to be able to compete and function in the marketplace. They do not cause you to stand out, but they’re essential. Then there are winners. Winners, as their name suggests, are those unique, distinguishing stand-out characteristics that give organizations, products, services, etc. the edge over competitors. For example, they prompt consumers or distributors to buy from one company over another.

Did you know that Jones International was the first full online accredited university? Do you care? Probably not. But their situation is worth noting for the lesson that it teaches. In the 1990′s when online was new and exciting, being the first meant something. Today, being online and first might be a winner only if the organization is developing new and different strategies and tactics to keep them as an industry/sector leader for other winning reasons.   When organization such as Phoenix University and other schools became online resources for education, the public began to see online education as a qualifier. For Jones to retain its winner status, it would have to develop new and innovative winners.

The Madonna Inn, located in San Louis Obispo in CA is a fascinating hotel whose leadership apparently (fortunately) didn’t get the memo on the concept of standardization.   The hotel houses 110 creatively decorated rooms, and each room is different.  My favorite is The Madonna Inn’s Caveman Room; if you’re looking to get away Fred-Flintstone style, this room may be for you.

Caveman Room

Just think of the thought processes planners who developed this project as a fun way to differentiate their product from competitors’ offerings.  If this group’s members were working with an idea bank–electronic or manual collection of ideas–I can’t imagine how creative the ideas were and how much fun they must have had determining the criteria for building their hotel’s rooms. Fun and creativity aside, they still needed a solid process to bring their ideas through the project’s stages and to completion. Just in the early stages, they must have been thinking for a long time about what should they build.  Then they had to ideate about the theme of each room.  What would the theme look like, the selection of the wallpaper or bed style, and more.

This is a perfect example of how often sub ideation occurs within the bigger idea’s ideation.  The broadest ideation includes the type of hotel.  Then sub-ideation occurs where planners are asking about what types of rooms to include, and then even further ideation includes the details for each room. Finally, planners must coordinate the tactics (plans) and the execution of those tactics. Wild!

Madonna Inn Website

When I hear managers say that the new vision of their firm is to get customers to like them better or that the new vision is to create better relationships, I’m always concerned for them.  While I understand what they’re trying to do, I also see how they’re headed in the wrong direction.  You can’t substitute your role of managing well with the position of wanting to be liked.  Business relationships don’t give back the returns you think they will, and if you don’t adjust your focus, you’re going to be disappointed at best and even suffer worse consequences.

Earning new customers involves much more than building relationships and getting people to like your firm. Widen your focus to how the firm deals with your customers from start to finish, well before your employees even enter the picture.  Customers may hear through the grapevine that your company doesn’t deliver on time or that orders are always screwed up.  How well will your “relationship” vision work now?

On the flip side if you throw out the “management guru” philosophies of getting in touch with your customers and first work on the processes that make the customer feel welcome from the get go, the relationship builds automatically.  For example, your firm supplies industrial washers and dryers for hotels and institutions or you create video production tapes for corporate distribution.  One sale is $75,000 a pop and the other is $5000-$10,000, yet they are very much the same.  All day long 365 days a year you ship washer and dryers or create Quicklime, Real Windows, CD and VCR production. You’ve heard some news that some customers may be unhappy with the products you’ve been delivering and that the opinion in the market is that you don’t deliver as promised.

Would your first reaction be to start implementing a customer-relations-building initiative?  Maybe you would even start to make phone calls to clients and ask them why they have been disappointed with the product.  Both might be good ideas, but you’re already barking up the wrong tree.  Customers don’t always know how your company works, so they can’t give valuable feedback on how to solve a problem. Also, just because you’ve made contact with a customer doesn’t mean that they will like you, it could mean that they now have an employee’s name to attach to their problem…that’s all.

A better approach is to build quality into your product/s.  Customers walk away happy when everything happens correctly.

A customer’s individual experience with your firm means more to them than how much business you process in a year.  Just because you ship 500 washers a year or 300 presentation tapes a year does not mean anything to the one person that is laying down the money to improve their business.  The higher the ticket item, the more you have to remind yourself of this point. Perhaps many of your customers think for months, should they or shouldn’t they buy.  The discussion is typically sealed when the buyer feels that parting with the money will give them a return of something more than what they spent.  The washer may make them $37,000 net per year and the tape may bring them $100,000 worth of new business if all goes well.  They want to feel as secure upon purchasing as they do on the day that their purchase arrives and for months after.

To do this start at the beginning.  The sales people or the materials of the firm should show them the process.  You sign and we start.  Delivery is in 4 weeks. With everything in between defined.  The check arrives and you send them an even more complete package to get them involved to the extent they want to be.  For the washer, you help confirm they know layout and the tools needed for on-site delivery.  For the tape firm you schedule a meeting with all the proper people and have an outline of how you can build a winning product.

Don’t ask the customer what they want!! Have a formula of questions that draws out what you need.

Make sure everyone is present and consider recording the sales call for future reference.

Throw in additional value.  That could be a booklet about tools to increase productivity or to improve marketing.

Even to the very end you keep the process going as it is designed. Don’t deviate or cut corners if the process works. You may have given your pitch  2000 times, but the customer has only heard it once.

Get the entire company behind you. If you’re dealing with items that have options or customization, a production expert might walk the buyer through a few paces so that the customer feels that your team understands them.  You want the process to win over the customer.

It’s like when you return to your hotel room after dinner and find a chocolate on your pillow.  How happy do you feel just before you bit down on your treat?  Hate to break it to you, but patrons in 1200 other rooms had a chocolate on their pillows, also.  The staff didn’t select only you to get a special piece.

Again, this is not to downplay the relationship-building process, but to put it in perspective.  You do a bad job, customers don’t return.  If you build a process that builds relationships, customers feel excited to work with a firm that’s responsive and delivers products or services as ordered.

Why is it that when people hear about a corporate bankruptcy, they become authorities on how it could have been avoided? It’s always easy to say you know better than someone else. Especially when you’re parked safely on the sidelines or looking at the situation in hindsight. But do you really know what you would do if put in the same position?

There are a lot of reasons why companies get in financial trouble. Some firms die because they deserve it. They’re mismanaged or they have products that stink. Others are good companies that make one mistake and pay a hefty price. Perhaps they don’t adapt to a market change quickly enough. Or maybe they tried to grow too quickly and ran out of cash. With so many elements to juggle, pinning down the “why” is not always easy for the outsider to determine.

Spiegel filed Chapter 11 in 2003. Spiegel was started in 1865. It’s parent to Lifestyle, Eddie Bauer, and Newport News. Its first catalog was produced in 1905. In nearly 140 years, Spiegel managed to do a lot of things right. When it hit a rocky patch, Joe Blow from down the street knew he could have done better. Really?

Look at the photo-film industry. Kodak offers good quality products. It was kicked in the face with the K-Mart bankruptcy, but managed to sustain the blow. Over the past 5 years, Kodak has made major adjustments to its product line to insure future success. Fuji Photo Film was a heavy competitor on price. The growing use of digital cameras threatened all film companies. Yet Kodak and Fuji were operating while Polaroid filed for bankruptcy.

On the surface, it was easy to see that Polaroid wasn’t adapting to the changing market fast enough. It didn’t offer competitive products. It didn’t market as well as other leaders. But WHY did executives at Polaroid make the decisions that they did? WHY would they “white-knuckle” their niche of instant imaging when one-hour photo processing and digital cameras were eroding their market share? What was going on behind the scenes that ultimately forced Polaroid to file Chapter 11?

Enough about everyone else. Your time is better spent focusing on how you can avoid damaging mistakes. Here are some tips:
1. Be an information gatherer. Start internally and look outward. What are your key deliverables? Are you defining what you really do? For example, are you a trucking firm or in the business of logistics? Canon says they’re in optics. Kodak says they’re in “memories.” That’s a selling proposition, but what do they do? Learn markets, talk to experts, and then make up your own mind.
2. Improve your management skills. Quality. Think BASF: “We don’t make the products you use, we make the products you use better.” Improve yourself to keep pace. Take courses to learn new tools. Read books in addition to magazines and papers. Look at trends and where you’re weak. Focus on one or two areas and not 50. You’ll be stronger for it.
3. Envision a realistic destiny. Make sure the picture you paint is one you can truly believe in. Most executives, owners, and managers can’t do this. If you’re one of them, watch out. This is an area where you can’t be wishy washy. Know where you’re going before you set out on the trip.
4. Be the driver. You can collect data and insight from others, but the direction comes from you. Your role as a leader is to lead, not get “group think” to the point that your company is crippled. As you move forward, you’ll gain new knowledge that might steer you in slightly different directions. Flexibility and adaptability are good. But make sure that you’re leading, not reacting.

You can’t fix a firm from the sidelines no more than you can play a game from the bleachers. When you see what’s happening in the world around you, don’t waste your time on second-guessing. Take what you can as a lesson and focus on your own firm. What you learn will bring solutions and strategies. You and your firm will be stronger for it.

When you purchase a green car, is the car really green?  Or is it just the engine?  When I see a green car, I see a work in progress. Tires still use rubber and oil, and cast iron and metals come from metal fabrication.  Fabrics and leathers, some which require formaldehyde and other chemicals in their production, are used. So green may not really be green.  The perception is green, or at least GREENER.

Take the GE locomotive.  Was GE trying to produce more efficient, lighter and more powerful products before the push for green?  You bet.  So then pushing harder is just a marketing tactic to suggest that Ecomagination is driving green.

I admit that the green movement has prompted more individuals to try harder to live, work, and produce in more ecologically-friendly ways.  Awareness over the past few years has driven consumers to buy products from firms that have been working on creating sustainable products.   And now you see how firms capitalize on the trend; when firms start moving to green, they promote and promote and promote themselves as going green.

Let’s say a wood manufacturer in the US switches from oil stains to water-base stains.  The firm’s products are greener and can be promoted as more eco friendly than competitors’ products in the US, even though in Europe, using water-base stains is more common. (Apparently water-base stains are not typically as brilliant as oil.)

Attracting market share based on ecological awareness only works if green is “in,” and we’ve seen that with hybrid cars.  Toyota says it took several years to sell 500,000 hybrid cars, yet once the green wave struck, it only took 2 years to sell the next 500,000.  However, with economic challenges, Priuses are no longer in high demand; they are sitting on lots across the US only because a typical hybrid takes 3.5 years to make a return on the additional costs.  When gasoline in the US averaged less than $2.00 per gallon, the payback was even longer.  Toyota can smile again as gasoline prices rise.

So green might have a little more of a challenge to overcome if the product or service is pricier.

What this means is, go green, but don’t expect your buyers in a challanged economy to make the green choice as readily in the past.  If you were to spend $100,000 going green, take 50% and change to green, and use the rest to increase productivity and reduce utility and labor costs.  You might say that going green would then be a double benefit that will not only be green, but even more sustainable since the cost of going green comes in different forms.

I know someone who spent a good deal of his summer lounging by a pool, vacationing with friends, and overall just kicking back and enjoying life.  Oh yeah, he was a manager, too.  How did he have time to manage his employees and amass so much leisure time, too, you may ask.  He didn’t.  He chose hanging out over working hard, but he had a good reason.

As he explained to his superior, a regional manager for the firm, the “economy” was bad in the area.  He was even generous enough with his time to take the regional manager, who was unfamiliar with the ins and outs of this particular city, on a joy ride through its worst slum…boarded up windows and gang-sign graffiti offered “proof” that the man with a tan couldn’t be blamed for his office’s poor sales.

The vast majority of the beautiful city was running quite smoothly, but the regional manager didn’t get that tour.  He was shuffled straight to the airport before he got a sniff of the truth that his local subordinate opted to darken his tan rather than increase his office’s sales.

Yes, I realize the economy has hit most of us in one way or another.  Some of us have gotten pummeled worse than others, too.  And while sales have taken a hit in many industries, I hope that you’re able to separate reality from perception.

Be careful not to discount your ability to perform on the job because the economy is suffering. There have always been and will always be those who bend with the times and create opportunity.

Also, be fair with yourself. The same assets you brought to your job are those that can help you now.  Don’t forget that you have those strengths and you might just need to change your perception of reality to begin to utilize those strengths today.

Companies like ebay and Amazon.com have to adjust to the economy and the current market conditions to continue to realize healthy profits; and adjust is what they do.  So where are you adjusting what you do to continue to thrive in today’s business environment?

It’s not just about persistence it’s about changing tactics to bring in new business.

On the program Hell’s Kitchen, the restaurant undergoing a business makeover gave away food as a way to announce the reopening of the restaurant. Their marketing tactic was successful, and the next day the restaurant was full.

If you suspect that the economy has become your crutch, toss it aside and take responsibility to walk on your own two feet again.  Adjust strategy and tactics, get creative with marketing and sales, and find ways to revive assets that have been nearly dormant since the downturn started.

Someone’s always doing well…it might as well be you.

Get this.  The APTA wants donations to help promote scholarships in the industry.

The American Public Transportation Foundation
Please “champion” the effort to ensure the future of our industry!
Dear Colleague:

We face a critical shortage of skilled and seasoned employees as thousands of workers from the “Baby boom” generation near retirement. We need to provide incentives to attract the  best of the best of our emerging talent. Your 2009 Champion gift will help achieve that goal, which in turn will helpus plan for a healthy, vibrant workforce. As you know, The American Public Transportation  Foundation provides scholarships for young professionals pursuing careers in public transportation. Your support will make our industry stand out from all the others. Our goal this month is to raise $5000.

….and yet when it comes to making our public transportation system stronger, they have been lacking in leadership.  Industry leaders are no closer to improving the transportation system then they were years ago.

Here is a sampling of what I recommended to the industry at a keynote to APTA’s executives.

US public transportation needs four factors to achieve 10+ % ridership:

1. Universal payment system. (You should be able to use your card in NYC, San Francisco and Atlanta and your own community as a universal pass.) This little switch would enable users to keep only one card in their pocket and most likely try another service around the country.

2. Connectivity of community public transportation systems with other communities (County roads, bridges and infrastructures, link to the next infrastructure. The same is necessary in order to increase ridership. Currently the systems do not connect.) Currently you can’t travel from Seattle to San Diego or Atlanta to Boston without jumping to an Amtrak or another service. It’s like building a bridge only half way and then stopping in the middle of the gorge.

3. Singular transportation guides throughout the system. (There needs to be one universal travel guide so that like airline travel, no one needs to relearn how to use a system.) I know I personally dread trying to figure out the maps in each city. Airlines have one system and so should the public transportation sector.

4. Transportation authorities need to be established. (Today, road and mass transit are at odds over how to use funding. With a transit authority the objective of the organization is to serve the public transportation needs in the best manner possible.) Right now the road and highway industry is 10x more powerful than all the other services so when it comes to funding. They get 90% of the pie even if it’s not the best use of the money to move people in that region.

5. Lastly, the future of public transportation will never improve until the industry moves from viewing that there are two types of users to three. Currently there exists the lingo that there are people with CHOICE and those Without Choice. With choice means they can use alternative forms of transportation, however, if gas goes up $1 per gallon, they might move into the Without Choice category. Obviously these users have only one method to get to work, shopping, visiting the doctor, etc. The group I suggested the industry see in the future is the group with MEANS. These are the people who earn $1 million per year and use the NYC Metro to get to work in the morning. These are the people with political clout and financial capital who would insure that NYC never closes the metro system.

What this means to the industry is “density” must be defined differently. They may get 50 people on the train in a low-income neighborhood and 17 people from the high-income community. The difference is the high-income travelers will make sure that there is a system at all for two reasons. They will be aware of the product AND it’s self serving. Their kids use it every day. (For those that don’t know, the industry looks for density of population to determine service development.)

Wow…I love technology that pushes us to think bigger. If this…then what’s next….!!!! Blood flow to the brain…who would have thought!