Roy's Blog: Business Strategy

January 21, 2019

How to make your retail business successful

It’s shocking to see the number of retailers that have not survived over the past year. These were established businesses with a history of loyal customers and decent profitability.

But they simply ran out of steam and couldn’t keep pace with the changes taking place in the industry. Buyer demographics and buying behaviours quickly change and retailers incapable of keeping pace die a slow and agonizing death — store by store by store…

Death of retail

There is no silver bullet — a single strategy — that will save a retailer in the current chaotic and unpredictable business environment, but there are some actions retailers can take to at least increase their chances of survival.

Renew your business strategy

It’s very tempting to take action and employ tactics that you think will help, but you need to start with redefining a strategy that you think will successfully meet the new dynamic.
The critical piece of thinking here is that you cannot assume what worked for you in the past will work in the future. I believe the main reason so many retailers fail is they almost religiously hold on to their past business model, expecting it to work in an environment where literally every customer — competitor — technology variable has changed.

In addition don’t get sucked into believing that cost cutting will save you. The retail death spiral is not a cost issue, it’s a demand issue. Cutting costs with the hope of salvaging the company has a perilous and inescapable outcome.
Did you really think that by closing over 1,400 stores Radio Shack would survive? Not unless they change their business strategy and figure out how to do a better job at serving customers and providing unmatched value in the marketplace.

Deliver value; don’t sell products

Look at your business as an instrument to deliver unique value, not as an agent to sell products and services. Think about being in the “benefit creation” business where what people want and desire drives the innovation process. The model of stacking the shelves — be it in a bricks and mortar environments or online — and having customers excitedly buy is wishful thinking.

Provide value

And your retail value must be different that your competition because if you’re not different, you will fall victim to the commodity space where the value proposition for any retailer is reduced to price.
Commodity market players “race to the bottom” with their prices much to the delight of the customers but to the detriment of the business as margins are squeezed and profits plummet.

As the telecommunications space was heating up with competition, we morphed our phone stores from outlets that offered telephones and accessories to residential customers to a solutions selling vehicle for both residential and small business customers. Product sales took care of themselves with this new focus.

Redefine who you want to serve

Change your target market. Demographics and psychographics are changing. Millennials are growing in number and will soon be the largest segment of the population. Continuing to target the older population, for example, because it has worked up to now is a choice with no long term future.
The question to ask is “Which customer group represents the greatest growth potential for our business?” Focus your energy on that group. Build capacity and competencies in your retail organization to satisfy the wants and desires of that group.

And say goodbye to customers who are no longer relevant to your renewed strategy. You can’t afford to hold on to your old base while pursuing a new one.
Deselecting customers is a difficult issue for most organizations as it means carefully shifting focus and investment away from customers who have traditionally been in the center of attention to a new breed who are unproven in terms of revenue generation.

Look for order of magnitude not incremental change

Minor changes to what you do and the way you do them won’t work; explore new completely different ways to completely morph your business. And consider outrageous ideas like the Heart Attack Grill in Las Vegas as well because the “traditional tried and true” approaches simply will not work anymore.
If your new retail idea doesn’t scare the hell out of you, chances are it’s too modest. 

Heart attack grill

We completely reengineered our phone store network by closing almost half of them and reconfiguring the survivors geographically through our operating territory. This was anything but a modest change for which we took considerable criticism. But it was necessary in order to place our new “customer serving centers” closer to the customers we decided to target.

Recruit a new team

if your current retail strategy won’t get you where you need to go, probably your existing team won’t as well. Be prepared to change the composition of your teams and recruit new blood with the skills and competencies necessary to deliver your new direction. Look for disrupters who hate the status quo; people who will push for change.

HR must constantly be on the lookout for the new breed; they should constantly be in the recruitment mode regardless of whether you have immediate opportunities available or not.
Sooner or later positions will open up, and you need a stream of people immediately at hand to draw on.

As the telecom business was changing from a monopoly to a highly competitive model, we had to purge much of the organization in terms of the skill sets and competencies in our people. We had to import a cadre of folks who had proven experience in the retail world and let go many who were effective order takers but not able to sell competitively.

Provide personalized service

As a critical element of your renewed strategy set your sights on providing more personalized service rather than the traditional one-size-fits-all doctrine. Retail success comes from engaging with and serving customers on THEIR terms, not on what the business deems appropriate given their internal constraints. If retail isn’t prepared to meet their customers on their turf, the game will be swiftly over.

We moved from a subscriber model in our phone stores to the strategy of creating more personal customer experiences for every person who came to our stores. One tactic we chose was to “make the inside mirror the outside”; in other words recruit employees that were integral to the mosaic of ethnic populations we served.

So in an area where we had a significant Asian community, we hired frontline people and leaders who were also Asian and who could relate better to this customer group and serve them better than people with other ethnic backgrounds.
Service levels increased with productivity and we quickly outpaced our competition.

Build a leadership team of servers

Hand in hand with establishing a service culture is the need to move leaders from a traditional command and control bias to a serve and coach paradigm where “How can I help?” supplants “Do this!”.

Servant leaders

Critical to providing a personal experience for customers, retail operations must do the same for employees. An employee who experiences a servant leader who is there to help solve problems and eliminate job barriers will naturally apply the same behaviour to a customer. They learn to be helpful to customers because they receive the same treatment from their colleagues and bosses.

In the same way we had to move away from customers we had traditionally targeted, we had as well to exit traditional command and control style managers to make way for people who were natural servant leaders.

Eliminate commission salespeople

Having commission salespeople is the anathema of the concept of serving customers and providing personalized solutions to their problems.
Employees who are paid to push retail product will flog their wares to, not serve, customers. They will push for the sale as opposed to taking whatever time it takes to problem solve with the customer.

They will have zero motivation to create memorable experiences for their customer because it takes too much time, requires too much energy, and because they’re not getting paid to do it. Be prepared for an exodus of salespeople when you do this; they will look for opportunities to continue their flogging ways with other retailers. So let them.

Retail businesses can survive; all is not lost. But it will require retailers to put the past to rest and take action to break away from “the way they have always done things”.

Those that have the guts to do it have a chance of surviving; those that don’t will die.

Cheers,
Roy

Check out my BE DiFFERENT or be dead Book Series

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  • Posted 1.21.19 at 04:05 am by Roy Osing
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January 7, 2019

7 reasons most call centers are absolutely shameful


Call center

Every organization that is big enough has a call center to handle primarily incoming calls from their customers.

There must be some redeeming value in having one if everyone has one, right? There is: it’s generally viewed as the most efficient operating solution for processing volumes of calls coming into an organization.

The dark side to call centers

But having led large customer service teams in a variety of business environments I have experienced a dark side to call centers.

In many cases I find that call centers represent the antithesis of miraculous service.

When an organization declares they intend to provide amazing service to their customers and then chooses an operating model with a call centre — particularly in a foreign country — as its nucleus, they are not only being disingenuous, they are fooling themselves (and probably driving their customers crazy) and assuming substantial competitive risk.

These are the aspects of call centers, particularly those that are outsourced, I find quite revolting.

They exist to manage cost

They choose to implement a call centre environment not to serve customers better, but to process volumes of calls at the lowest cost possible.

The question is rarely asked “Is this the best way to both serve our customers in an exemplary way while at the same time optimizing our cost position?”

It’s all about cost. That’s why most organizations outsource them around the world where labour costs are low. Current outsourcing destinations include India, Philippines, Thailand, China and Indonesia with many more planning to enter the fray.

Reduce cost

This outsourcing trend has attracted a plethora of experts who define what it takes to have a successful call centre.

They are managed to improve productivity

Effectiveness of a call center is generally based on micro productivity measures such as:

1. average holding time — the elapsed time it takes a call center rep to handle a customer query. Management tries to drive this number down in order to process as many calls as they can with the resources available.

The outcome of each call is rarely measured. Was the customer satisfied with the service they received? Did they enjoy the experience with the rep?

2. average speed of answer — the average length of time it takes to answer an incoming call. When I ran call center operations in the telecom world, my target was to answer 80% of all calls within 6 seconds and our resource levels were set to achieve this result.

This was probably the best internal target we had that represented an attempt to deliver good customer service.
Can you imagine in today’s world reaching a call center rep of any organization within 2 or 3 rings of your phone? Rarely ever happens, with common wait times in the minutes rather than seconds.

Productivity and service miracles don’t easily coexist in most organizations; this measure needs attention if any organization wants to get out of the revolting category.

They don’t drive customer loyalty

Whether a call center serves incoming calls or is used to originate sales-type calls, the heavy traffic volumes involved generally work against the relationship building activity that leads to a loyal customer.

A call comes in > the rep answers (eventually) > the rep deals with the customer’s request > the rep terminates the call > the next call is fed to the rep.
And the cycle is repeated over and over again with a supervisor scrutinizing how long the rep is on each call.

The call center is essentially a production shop with no overt objective of creating an experience for the customer that could lead to brand loyalty.

Customer satisfaction may be measured along with productivity objectives, but a satisfied customer does not make a loyal one.
Satisfaction means that expectations were met; loyalty demands more — minds must be blown, expectations exceeded and marvelous experiences created if the loyalty dial is to be moved.

Wham bam

And this takes time. A WHAM! BAM! THANK YOU MA’M! process does nothing to encourage warm feelings and a desire to do more business with the brand involved.

They take control of your brand

The moment power is given to an outsourced call centre to engage with your customers, control is relinquished and your organization’s brand is put at risk.

Many organizations don’t even put in place a performance management contract with the 3rd party outsourcer to measure how customers perceive the service they receive from call center reps, so changes to brand position are unknown and can’t be responded to.

And with high turnover of employees, consistency in whatever customer treatment is given is almost impossible — at least I don’t experience it.

When your customer connects with the call center you have chosen to empower with your most valued asset, and the experience they have does not go well, it’s on YOU.
The call center rep is YOUR employee. The service outcome is YOUR responsibility.

YOU pay the price in the market.

Their words create the precious moment

Whether a customer has a miraculous service moment or not depends on communications with the call center rep. Miracles happen when the engagement is spirited, entertaining and responsive. When there is an easiness to the conversation that leaves the caller happy and fulfilled.

And for me, very often it is extremely difficult to fight through the accent of a foreign call center rep to have a meaningful and enjoyable conversation.
I simply can’t understand many (not all) of them, and that’s a BIG problem for the outsourcer.
If even the basic communications expectations of the call can be met, there is little chance that a service miracle will ever occur and in fact the opposite is the result with the caller being annoyed or angry with the encounter.

It’s not that the foreign reps are uneducated or don’t have some skills in the English language.
But it’s one thing to pass English 101 and have an understanding of sentence structure and grammar, and quite another to engage with someone else in a way that flows and is productive to the other party.
Are these reps tested by role playing to evaluate their conversational proficiency? Not from where I’m sitting.

Long

Wait times are shameful

Outsources really don’t care about how long we wait on the phone to reach a rep; if they did, they wouldn’t tolerate wait times that often reach ridiculous levels — for me personally, I am blown away if I actually get a rep in 5 minutes and am not surprised to wait 45 minutes or longer. Business mediocrity in action.

It’s ironic that wait times take no priority at all; organizations are content to provide messages they feel assuage their shameful service: “Your call is important to us”; “We are experiencing unusual traffic volumes at the moment” unfortunately greet us more often than not when we call for help.

But wait! There is a silver lining to long wait times. Put your iPhone on speaker, slip it in your back pocket and get on with the job jar your wife has skillfully filled for you.

The reps have an impossible task

I totally get that even a highly competent and caring call center rep has a tough time being on 100% up time.
By the time a customer gets to them, they are often met with frustration, anger and sometimes abuse, with literally zero chance of turning a bad encounter into a pleasant experience.
The reps simply wants to get away from the pain they are engulfed in.

And the rep of course doesn’t own the problem — leadership does.

It’s a pipe dream and shameful leadership behaviour to create an impossible working environment and expect employees to perform impeccably. What planet are they on?

It’s quite simple, really.
If you want low costs, technology can do only so much and you will be saddled with the result. Under-resourcing is typically the result of cost cutting in the face of relentless demand and who pays the price? CUSTOMERS DO!

Call centers generally don’t focus on building intimate customer relationships and outsourcing them makes matters worse.

There are exceptions, however, but these rare organizations make the decision to establish their call center as an integral loyalty building instrument not as an efficient call processing center.

So if you decide to use call center technology to engage with your customers, please don’t preach your intent to deliver amazing service.

It’s intellectually dishonest and it fools no one.

Cheers,
Roy

Check out my BE DiFFERENT or be dead book series

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  • Posted 1.7.19 at 04:10 am by Roy Osing
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December 7, 2018

How to create the perfect name for your business — guest post

If you are in the process of starting a new business, there are many important things that will need to be considered. Things such as the product or service you’ll be selling, your target market, and your specific business structure (sole proprietorship, LLC, etc.) will all be very important.

But one aspect of starting a new business that people often overlook is their company name.

Though, at first, your name may seem to be a rather small detail, it may actually be what ends up either making or breaking your business. Furthermore, your name is one of the first ways that your business can establish a clear competitive advantage.

Perfect name

Fortunately, the perfect name for your business is something that is likely well within reach. In this post, we will discuss the most important things for you to think about when brainstorming business names and we will also discuss some of the most time-tested strategies you should consider using.

Choose a name that’s original

There is no doubt that in order to survive in the competitive world of business, you will need to demonstrate your relevance and separate yourself from the competition.
If you are someone who is considering entering an already crowded industry—which even tech startups are beginning to get quite crowded—then you will need to choose a name that will make a lasting impression.
As you begin the process of searching for original names, you should also define your mission, your company values, and the specific image you are hoping to inspire.

More often than not, your name will be one of the first thing that prospective clients and investors know about your company.
You should assume that there are already a dozen companies offering a similar product at a similar price. So instead of conforming to the norm and latching onto a name that may have been useful twenty years ago, you should redefine the standard and come up with a name that challenges the norm.
Though taking chances can sometimes be uncomfortable, doing so is an essential part of becoming an entrepreneur.

... but also make sure the name is easy to remember

Many companies that hope to come up with an original name often end up creating new words. Tech companies such as Facebook, Microsoft, Android, and others have all chosen names that—prior to their initial establishment—would not be found in any English-speaking dictionary.
However, while all of these names are indeed unique, they are also relatively easy to remember.

Remember

Here are some of the essential things you should keep in mind when trying to create a memorable name:
    — try and limit the number of words and syllables that your name uses
    — even if you are using a made up word, choose a word that is easy to spell
    — try this simple test: give someone you know a list of ten words (one of which is the name you are considering) and then ten minutes later see which of those words they are able to remember

Though the “test” mentioned in this list is obviously non-binding, it can be a very useful checkmark throughout the brainstorming process. Usually, it makes sense to come up with a list of many possible names and then see which ones are actually able to stick.

Check to see which naming strategies are common in your industry

Despite the fact that you should strive to come up with an original name, it is still a good idea to understand the various naming strategies that are standard in your industry. Whether you end up adopting these strategies or turning them on their head, you should still be aware of how your industry works.
    — Naming a company after the founders or owners: this strategy is especially common for law firms, real estate firms, and other similar businesses.
    — Using puns, portmanteaus, and other plays on words: this strategy may be useful for businesses that focus more on creating a friendly image for their clients (rather than focusing on trying to lure capital investors).
    — Creating a word that is entirely unique: this is one of the most common strategies used by members of the tech industry and other industries attempting to be futuristic.
    — Trying to sound traditional: when it comes to creating new business names, century-old traditions are typically a bad idea. However, these names may sometimes work for the more “serious” industries such as banking, insurance, and medical care.

Another trend that has recently emerged is the use of single words—nouns, verbs, and adjectives—when coming up with business names. Whether or not this strategy will be appropriate will depend upon the nature of your business as well as your target audience.

Test the name with potential future clients

No matter what product or service you may be attempting to sell, what remains universally clear is that some people are simply much more likely to identify with your brand than others.
Once you have defined your target market — demographics, lifestyles, etc.—then you will be in a position to gather a focus group that can potentially test your name.

Target market

When running a focus group, there are a few things you should keep in mind. Not only should you make sure that your name is one that people actually like, but you should also make sure that the name is one that is able to effectively connect with your desired brand image.
Even though there is likely a name that you personally prefer, it is important to try to be objective and open to outside input.

Confirm that your business name is entirely usable

Lastly, once you have narrowed your list to a final name or two, you should check to make sure that your name is universally compatible. Typically, this will involve multiple different things:
    — making sure none of your competitors have the same name or even a very similar name
    — making sure that your name is compatible/non-offensive to other cultures (this is especially important for international businesses)
    — making sure that there is a suitable web domain available for your name

Thoroughly investigating the context of your name is very important. One of the last things you would want to do as a new business owner is have to rename your company right off the bat.

Conclusion

The naming process is one that is absolutely crucial and should not be willingly ignored. There are many different things that will need to be considered when coming up with a new name including your company values, originality, and whether or not your name is actively available.

By taking the time to find the ideal name for your business, you will be in a much better position to succeed and stand out from the crowd.

Grant Polachek is the Director of Marketing at Inc 500 company Squadhelp.com, the worlds #1 naming platform, with nearly 20,000 customers from the smallest startups across the globe to the largest corporations including Nestle, Philips, Hilton, Pepsi, and AutoNation. Get inspired by exploring these winning brand name ideas.

  • Posted 12.7.18 at 04:41 am by Roy Osing
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November 26, 2018

The right idea with no execution is a waste

How many times have you heard someone say “right idea!” when there is an execution blip that nullifies success and an otherwise brilliant notion bites the dust.

You hear it in kids’ sports all the time, particularly soccer, where a plan to pass the ball to a mate is intercepted by an opposition player. The right intent was there but execution fell short of an awesome outcome. “Right idea!” is intended to support the right behaviour and encourage the player to try it again and again until it works.

But it’s deflating. You can see they have a picture in their mind of what the result should be, but it’s shattered when it doesn’t play out the way it was envisioned.

Missed

The situation has a parallel both in organizational and personal life.

Organizations have a “Right idea!” when they develop their strategic game plan; individuals have a “Right idea!” when they plot their career or life destination.

Right ideas are plentiful

There is no shortage of right ideas; organizations come up with plans to grow their business and individuals always have ideas — or dreams — to build a better life or take their career to a higher level.

The thing is, the percentage of right ideas that make it through the successful implementation funnel are few and far between — for example half of startups fail in the first 5 years and it’s not an exceptional occurrence when careers fall short of expectations.

The failure to execute on a “Right idea!” is beyond disappointing, it hurts.

In my experience people just don’t spend enough time determining exactly what has to be done to bring the right idea to life.
The idea may be borne in an instant but more time is required on what to do with it to see it to a successful conclusion.

If you can’t implement, you’re done — end of your story.

These four essentials will increase the odds your “Right idea!” crossing the finish line.

Double down on implementation

Be prepared to dive deep on determining how to execute your idea.
Unfortunately the idea has no life on its own; it’s a figment of the imagination; a mere possibility.
It needs to be transformed into something practical before it has any value.

Double down

The idea to prevent a driver of a vehicle from using their mobile device while driving is an easily understood solution to the distracted driving problem, but unless it can be delivered to the market it remains on the entrepreneur’s wish list. The idea emerged 24 months ago in an insightful moment; implementation is 2 years in and counting.
And a career goal to be a VP without a disciplined strategy to get there is a dream with a low probability of success.

Focus on ONE (or two) things

Don’t try to boil the ocean; focus on a handful of actions that you believe will result in successfully seeing your idea come to fruition.
There are many actions you COULD take to implement your idea — usually a result of brainstorming — but the challenge is to define the few critical moves you SHOULD make.
You don’t have sufficient time or money to pursue numerous approaches at the same time; narrow them down to one or two that you believe are essential to moving the implementation yardsticks fast.

In business, one effective way of achieving this is to select ONE target market to attack rather than spraying your efforts across several potential ones. Rather than focusing on a consumer segment, for example, which is complicated and often expensive to penetrate, target a specific business application which is more easily reached.
Or, go after a confined geographic area — a province or state —rather than a broader one like a country.

In your career, concentrate on ONE specific position in a specific organization you want rather than sending your résumé out to “the world” which will likely get lost in the noise and be ignored.
In terms of personal resolutions don’t choose 5 or 6 popular ones; pick ONE that really matters to you — it’s unrealistic to try and accomplish too many things; it will rob you of your optimism and energy.

Don’t chase cars

Stay focused; resist the temptation to stray from your action plan when new possibilities descend on you.
It’s all very well to be open to new avenues to explore but it can end up with you chasing anything that comes along.
Chasing makes you busy, but is unlikely to achieve the results you want.
Every entrepreneur faces this issue. They no sooner lock their launch plan down and a new possibility comes over-the-transom and hits them — an application, a partner, a technology change.

Chase cars

Yes, this “yummy incoming” should be considered and examined thoughtfully, but not chased. Thoughtful consideration of these new possibilities must be given and should have overwhelming benefits before you decide to give up your initial execution plan.
On a personal level, how many times have you been on a path and something new and cool shows itself? Awfully tempting to drop what you’re doing and chase it, right? DON’T!

Plan on the run

Make changes on the run in the face of setbacks that question your idea. It is a rare event when your original implementation plan plays out the way you had intended — not because of yummy, but due to your planned actions not achieving the results you expected.

For example, a planned sales channel couldn’t be negotiated, your original pricing model was unacceptable to potential clients or the original revenue estimates from your primary target market were overly ambitious.
In circumstances like these it may be appropriate to revise the direction of your implementation strategy.

“Right idea!” is a great place to start, but unless you put on your execution hat with this guidance, it will never see the light of day.

“Right idea!”; “Brilliant execution!” is the combination that will ensure you avoid the remorse of failure.

Cheers,
Roy

Check out my BE DiFFERENT or be dead book series

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  • Posted 11.26.18 at 04:39 am by Roy Osing
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