Archive for August, 2005

I’ve thought about this often. What would it take for management and leadership to compete and win in today’s business climate given the pace in which everything is moving? The answer is obvious. However, you need to understand one concept and history to tie the pieces together.

The concept is that strategy is the first indicator of success – minus the luck. Consider this:

The wrong strategy executed well will offer poor results.
The right strategy executed well will offer great results.
The wrong strategy executed perfectly, will still suffer less than perfect results
The right strategy executed poorly could be the end of any future strategic session.

Just think military. The key is the right strategy.

The second piece of the puzzle is that throughout history the pace of change or the need to compete focused management on developing systems and structure that would enable those involved to succeed.

In the agricultural age, strategy played a role, and yet one could only do so much with the tools at their disposal. The farm and the factory were improved at a given pace.

In the Industrial Revolution during the 1900′s, strategy again played a role. At that time the increases in efficiency came mostly from streamlining and improving manufacturing techniques, forcing the next “pace” change.

Around the 1950′s, management/leadership shifted much of its efforts to increasing office activities with the introduction of automation and computerization. The effects changed both the back room and office productivity. One change drove the other. Management had less time to think, and the consequences were swift, if the wrong strategies were implemented.

By the end of the 1990′s, technologies converged so that global business was taking place at 24/7 speeds. You could wake up in the morning and be surpassed by someone working on three continents doing ad, computer or engineering design. The pace ratcheted up. Strategic decisions now make a whole heck of a lot more of an impact.

The 21st century arrived, and the battle has left the floors of the warehouses, has left the assembly lines, and has left the tactical office applications. Everyone has access to them. The future of an organization is riding more and more on the speed in which management/leadership can make the “RIGHT” decisions. The wrong strategy could be disastrous.

Think of it in terms of driving your car. If you drive on typical city street, you can think at one speed. Change the environment and drive onto a highway, you know the speeds changed to 70 MPH (112 KM/H, ) so you change. You become more conscious of your driving and what’s going on around you.

Get on the autobahn and hit the accelerator to 130 MPM (209 KM/H)…your attention is on your driving and the road. One split-second wrong decision and you’re dead. Now take that same feeling and double it to 220 MPH (354 KM/H). You’re now in a Formula One race car. Everything must be perfect. Make a wrong decision to go too high on a curve, and you’re going to hit the wall. Relax for too long, and you might roll the vehicle. You know that feeling even when you’ve taken a traditional curve at the wrong speed. Your adrenalin starts to pump, and you’re praying you don’t hit anything.

Now add 30 other drivers to the picture. You’re hurdling down the track with other vehicles inches from your car and you’re thinking constantly. Careening at lighting speed, for hundreds of laps the experience is either fun or seems like almost an eternity, if you’ve just started to learn to drive or even worse, you hate driving fast.

Like it or not, today’s business environment is much like this, and you have no choice.

This rapid pace is unparalleled in history. That’s not to say people in the 1930′s didn’t feel the same way. The British, Japanese, Koreans, Germans, Swedish, Brazilians are also all feeling it.

The Chinese are feeling it turbocharged! They just entered the race, and they’re having to learn everything just to catch up, and then surpass the rest of the world, like fast forwarding on a movie.

Thomas Friedman reported that in the first few years of the 21st century, over 15 million Chinese workers were laid off due to automation…or management making strategic moves to eliminate labor and replace it with more current technology. The US has laid off 2 million workers. THESE WORKERS WERE JUST HIRED A FEW YEARS AGO TO ENTER THE RACE, AND NOW THEY’RE OUT.

Ouch.

The fact is, in order to compete management must learn to think faster or at least faster than their competition. This means a significant change.

What type of change?

Management, too, must be automated. No longer can a financial officer look at two financial reports to compare numbers; computer programming and soon to be Artificial Intelligence tools must do it for them. Management, in turn, must make the final decision. In our future world, decisions will be made in bits and bytes, and everything will be immediately put in motion. No longer must a purchasing manager tally over numbers, because statistical analyses, along with “management’s” automated responses to these numbers, must be dialed into the system.

That’s not to say that traditional thinking is gone. Thinking will change as it did for the farmers, the factories, and the office workers who have evolved their roles throughout history.

In summary, it still comes down to strategy, as that is where everything starts and where outcomes are born. Those that can make the right strategies fast enough get to eat and rest (only for a second) as we move into the world of milliseconds.

My guess is that it’s going to be the convergence of thinking and technology as we get plugged directly into the systems we develop…physically! It’s the only natural progression. Wireless devices will tap directly into human consciousness. As computer speed equals the human brain in the next 5-15 years, we may even find that our brains are too slow.

How fast will this happen…I bet it has already started.

Simple philosophy to remember…

In horse racing…
There is a horse that wins by a nose
and there’s a horse that loses by a nose.
The loser typically takes home very little.

In sales…
There is a salesperson that wins by a nose
and there’s a salesperson that loses by a nose.
The loser typically gets nothing.

In business…
There is a business that wins by nose
and there’s a business that loses by nose.
The loser loses all the profits.

In the military…
There is a force that wins by a nose
and there is an force that loses by a nose.
The loser dies.

What if everyone in your organization fought for a common goal…like a soldier?

Too often we spend our time believing we have to be several times better than who we are up against to win. It’s not true. Imagine you went on 74 sales calls in a year and found that you were, as one of my clients puts it, “second loser,” most of the time. All you’d have to do a little more often to win is not be second loser. Winning is often as easy as being faster to submit a proposal, being better at finding out the buyer’s real objectives, being smarter about reaching the true economic buyer. Simple changes could produce windfalls.

Think, if you or all your sales staff secured a few more percentage points of your sales: from 24% to 31%. What type of commissions and profits would your firm generate?

In business, you’ve got two options. First, find out where your human and capital assets can beat others by a nose or more. Second, fix something in your system that causes you to lose so often. It could be sales, marketing, operations, finance, training, showing ROI, logistics, etc. If you made a few STRATEGIC CHANGES, you may find out that those small changes keep clients longer or generate more word of mouth.

Think again; how many times has your financial officer been good and not great, causing you to lose a deal? How many times have packages been shipped out late or you just worried your customer? That 98% on time still leaves 2 people out of 100 waiting. What would it take to get those few extra percentage points, and what would it mean to your firm?

Could you take the extra 10 minutes to do it RIGHT? That’s the nose!

Maybe if you worked like the men and woman who fight in the military every day around the globe—they work to win—you’d see different results.

If you can affect truly global change that helps you win by a mile do it. For the most part, I’ve found that you fight in business in arenas that you believe you can win in and so do your competitors. Therefore, probably more than you know, you’re losing by only a nose.

Here’s a simple digital document handling technique that has saved me and my clients hours of frustration since the year 2000!

Several years ago I became frustrated with looking for documents, either in folders or anywhere on my computer/server, so I began playing with different ways to store the documents.

My first attempt was the obvious: to create documents with alpha coding. However, that first solution ran into a snag quickly especially when there were tons of documents. Besides, I never can easily remember the name of a file created years ago.

Date filing also was a problem. This is the reason why.

January 15, 2002 would be represented at 01-15-02 and so December 3, 2002 would then be read as 12-03-02. The order on the screen would look like this.

01-15-02
12-03-02

Looks good so far. Add a few more dates to the list and your filed documents may look like this. And up to this point everything is great. Your files are in order based on dates helping you to remember when the file was created.

01-15-02 Drive Free
05-06-02 Trademark case
09-22-02 Gap proposal
10-30-02 Macro file
12-03-02 Travel schedule

The philosophy is that you can typically remember when a file was created…two years ago, six months ago, but it’s much more difficult to remember, in 64 documents, what the file name might have been. This process narrows down the field real fast.

The trouble happens when you have a change in years. Watch.

01-15-02 Drive Free
05-06-02 Trademark Case
05-23-03 *************
09-22-02 Gap proposal
10-30-02 Macro file
12-03-02 Travel schedule

Computers follow the first digit then the second. 05-23 puts the date in the middle. Next think you know you have a hodge podge of files in random sequence.

The answer.

Change the date sequence to year-month-day. Your list of documents will now print out like.

02-01-15 Drive Free
02-06-02 Trademark Case
02-09-22 Gap Proposal
02-10-30 Macro File
02-12-03 Travel Schedule
03-05-23 *************

The most current file is now at the end of the list keeping everything in chronological order.

Now my guess is that most of your folders don’t have thousands of random documents, because you’ve probably created folders to hold items of similar issues or topics. In this way you’ve kept the number of files in a reasonable order to have easy access.

This simple chronological-filing change will last you way into the year 2999. In the year 3000, I suggest you make a change to the approach. I most likely will not have to worry about that day…but you never know.

It was not just a year or two ago that most of the airlines had made some major shift to using regional jets as much as possible to lower operating costs and to increase the amount of “full passenger flights” in the system.

It seemed obvious that regional jets were the way of the future, at least it’s what management had thought.

But in 2006, United Airlines (WSJ August 15th) had a change or heart or more specifically, they made a switch in strategy, because they listened to their customers.

Frequent and long-term passengers had been complaining that long haul flights over 2 hours were uncomfortable and many missed the first-class services that made such a trip more enjoyable (or more tolerable), depending on your point of view.

They will start running 80 passenger planes and 66 passenger planes. In both there will be first class, “Economy Plus,” and coach seating. (In case you were wondering,) Economy Plus has more leg room between the seats.

Just when it appeared that management was not paying attention to their customers, they did a 180 degree turn. What a great strategic move.

NOTE: Not always do customers know what they need in as much as they think they know what they want. It’s often tough to keep separate needs from wants. If you focus on filling a need, because you assume money will flow in as a result, you might be disappointed in the feedback. The smart executive is one who can fill a need and satisfy your customer’s expectations—their wants—as well.

I just learned an interesting fact from an expert on marketing to diversified Asian markets. He said 6% of Americans own a passport.

It got me thinking. Six percent is nothing when it comes to 270 million people. In round numbers, it would be about 14 million people—or less than the entire population of New York City. Probably, out of that 6%, a large portion of those people are not world travelers but just people who have a passport. The others have a specific reason to visit a specific country. Maybe a family or friend has gone to school in Germany so they visit once a year. Unfortunately, this type of travel does not make Americans worldly, and it does nothing for understanding world cultures.

Kind of safe in the US comes to mind.

I quickly decided to do my own impromptu survey without much regard to statistical accuracy. I did not talk to any inner city families or take a hike into rural West Virginia. I just asked some of the people I ran into over the course of the next few days.

What I found of was fewer than I thought had a passport and of those that did, few traveled outside of the US. One lady, Kara, thought about the 6% for a moment and mentioned that her parents are travelers…and then she rescinded the comment with some thought. They only visited her sister in Spain.

It amazed me and it caused me to think some more…

There must be ramifications in business, government, education, and the military when people who appear to dominate the global landscape and who play a role in the selection of those in power have limited global knowledge. No wonder we’re not best friends with the rest of the world.

I propose that more people travel to another part of the world just to learn about one another. If you think you can’t afford it, look into the many special fares that often make a trip cheaper to fly from Chicago to England than to Fargo, North Dakota. If you still decide not to go, then you’re part of the problem and should stay out of all conversations related to outsourcing, offshoring, the European Union, global competition, and the education of our children.

If you really can’t afford it, I understand. Travel via the internet to catch some new perspectives from the shoes of global neighbors.

I’m still thinking; I hope you are now….

Over the past few months I’ve heard the same thing three times from different people in different parts of the US. They’ve told me they are fed up with their local sports complex and specifically their tennis club. The reason. Get this. Because when they were injured or pregnant the club refused to grant them an extension on their membership.

I wouldn’t have been as quick to believe that management and owners of such facilities would do this to a member however it happened to me. I just thought I was a rarity.

Here’s my story and others.

In 2004 I broke my rotator cuff right off my arm. Quite literally I separated my bone from the piece of bone that held onto my rotator cuff to the extent that I could not pick up my left arm. Obviously I could not play tennis nor do anything that involved weights for almost 6 months. When I approached my local racquet club and explained the situation they refused to suspend my membership for 3-6 months so that I may return again when I was able.

I had paid for a year and had been using the facility often. When this happened I let the FAMILY membership expire and have not renewed since then. They not only lost me for the normal fees they lost me for the next year and potentially forever.

Now, you might be saying to yourself, they must run a business and they can’t count on accidents. Here’s another story and it’s quite sad.

A young lady had paid her membership dues and within a month she found out she was pregnant. Due to past complications her physician asked that she take it easy until her delivery. The racquet club told here that their policy was they must be notified 6 MONTHS in advance before they would suspend a membership for any length of time.

The family and at least 4 other families have not renewed their memberships for the past 2 years. Instead of retaining $700 per year per family, plus court fees at $32.00 per hour, and purchases made throughout the year. Management lost it all with poor long term thinking.

The trouble is that short term thinking has blinded so many owners and managers that long term customer value is often lost. I always remember a lesson taught by Joe Girard, years ago known as a killer car salesperson. His philosophy was, a customer may buy one car at $10,000 US (in the 1970′s) but he/she may return 15 times over the course of their lives making them a $150,000 customer.

Some policy is right to follow, but those that create ill will in the eye of the customer, because it goes against the beliefs of a culture as to right and wrong, will easily put your business into a decline.

Just a few days ago I pulled out our Insta-Bed inflatable mattress only to find that the cover that holds the batteries in place had been misplaced. The challenge is that these beds require a ton of air and without the battery operated built in fan the bed could not be filled easily.

I tried all sorts of things to get the 4 D size batteries to work from holding them with metal pieces to just pushing hard and praying. Ultimately I remembered I had a battery operated lantern that ran on 4 D batteries also and I was able to hold the cover plate in place until the bed filled itself. The whole exercise really hurt my hands.

When done I faced the bigger challenge. Who manufactured the bed and how could I get the spare part without paying through the nose. With a few quick searched on the net I found out I could replace the entire bed for around $90 US plus shipping or tax.

I then called the company expecting to be arguing about how the cover is not attached to the bed like the other covers and how this would make life so much simpler. Anyway, the person on the other end of the phone was able to figure out the model I had (there were no markings) and what cover I needed. To my surprise she asked for my address and said, “It will go out today.” Kinda stunned I wasn’t sure if I should ask her if I needed to give out my credit card as I had it sitting right in front of me. She then thanked me for the call and told me to have a nice day.

What a surprise. Wenzel Company, the manufacturer had made me feel pretty good about my purchase BY NOT SCREWING ME ON A REPLACEMENT PART.

That was the first WOW experience.

The second was receiving this little mailer. I thought it was so cute and efficient that I just had to post what the company had done. Instead of sending this huge box or padded envelope they created a small parts bag. The part came in perfect condition.

I’d think if you were working in this firm, management had made sending parts easy. A small pouch with a draw string and a place for the envelope. Cheap and efficient. Quite impressive thinking.

I just love when someone’s taken a stale product or service, then gently places a twist on the concept to make if fresh and alive. PODS, and acronym for Portable On Demand Storage, has achieved such a goal.

Founded in Pinellas County, Florida in 1988 the company has grown to cover most of the US through by offering an alternative to self storage facilities or moving company services.

The concept is simple. Allow those wishing to store belongings, either personal or corporate, in weather-resistant containers that you fill on your property at your leisure.

Using a specially configured truck and container the company drops of the container when you need it at the location you request. When your done they then pick up the container that is equiped with a VERTICLE lift to keep everything flat. The driver then takes the container and stores it in thier warehouse until you request to have the items returned.

No more filling a truck, then driving to a storage location only to handle the items twice. You fill it, then they carry it away for storage.

I guess the moral of the story is, there is always a twist you can put on an old product or service to make it new again.

Last month a client of ours in South Carolina gave me what he considered an absolutely fantastic gift. At first I was a little dismayed. It was a toy wrapped in toy packaging as if it were to appeal to a child running through a retail store.

To say the least the toy, called 20Q, impressed me to no end.

The first thing you’re supposed to do is think of an item and then put the game in motion. Using artificial intelligence, within 20 questions it will guess what you’re thinking.

For my first selection I thought of a toe…and it guessed it! I tried next, a guinea pig. It guessed that too. Time after time it either selected what I wanted or was so close that I might have been thinking bark and it answered tree.

I was so impressed I started to look into its history. Robin Burgener, the inventor, started working on the process back in 1988 using the patterns of neural-networks. They way people think.

The website ThinkGeek.com has a great explanation of how these have been translated to the toy. “The artificial intelligence behind the game is a neural-network, similar to a human brain. A brain, or neural-network, is built from neurons connected by synaptic connections. A human brain has about one hundred trillion (100,000,000,000,000) synaptic connections. The 20q.net online version currently has about ten million (10,000,000), and the pocket version has about two hundred and fifty thousand (250,000). The game uses the neural-network to choose the next question as well as deciding what to guess.”

When I returned home I was so impressed I went to my local Wal-Mart the next day and bought four for friends. One individual used it for here trip to the Bahamas then entire plane flight and as you might have guessed 20Q did as promised.

The bigger picture is that if a toy can do this in the year 2005 what will artificial intelligence be able to do for you in 2010 or 2020. Might it take 20 questions or technology brings this down to 11 questions. Will call centers and websites be able to solve our challenges over the network and then send a virtual thingy to fix our computer, refrigerator, spot welder or what ever challenge we might have right over the network just by the individual supplying a few pieces of data to a computer code.

The answer is yes. If a toy can do it today, medical diagnostics might be able to be done tomorrow in an incredible automated process.

You put your arm on your medical devise (a mouse, a pad, a scanner, etc.) and within just a few responses through a digital technology, your being diagnosed and supplied with the treatment with no human interaction.

It’s amazing what a toy today might do tomorrow. Check out the toy 20Q for under $20 or try it online at (www.20Q.net).