Be Different or be dead

February 11, 2012

5 proven ways to cut cost without hurting service

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5 proven ways to cut cost without hurting service.

Don’t fall victim to reducing costs and, as a result, killing your business.

If you have to take costs out of your organization, follow these 5 steps to ensure that you are better off after costs have been taken out.

1. Renew your business plan — Cost cutting in any organization should be preceded by a review of your overall strategy. If your margins are suffering, take a step back and renew the path you are currently on.

General across-the-board cost reduction in the context of a strategy that isn’t working could reduce performance further.

2. Determine your new cost envelope — To effectively reduce operating expenses, you need an objective. What should your expense base be given where you expect revenues to be and what margin would you be satisfied with? Cost = Revenue - Profit.

For example, if you expect revenues to fall to $100 but you expect a 25% margin, then all your operating costs can be no higher than $75. If current costs are $150, you have your work cut out for you!

3. Modify business processes — With a reduced cost envelope, look for opportunities to simplify your business processes. Taking costs out of the business without changing HOW you operate is a recipe for disaster as it generally negatively impacts how customers are served.

4. Simplify your organization structure — The flow goes like this: strategy -> process -> structure. Create your strategy; deliver it through simple business processes and then look for the appropriate structure to organize and apply scarce human resources.

A rich source of expense reduction after process change benefits have been extracted is your structure. Simplify it. Remove levels to get the senior ranks closer to the customer.

Remove ‘ion’ positions: co-ordination, liasion and so on. Keep the positions that drive output.

5. Cut the CRAP — Shed all the things you are doing that are no longer relevant to your renewed direction.

Consider crap candidates such as low value customers, unprofitable products, mass advertising and long terms projects that can be postponed.
Assign a Cut the CRAP champion to eliminate costs and give them a non-negotiable mandate to take a knife to irrelevant stuff.

If costs don’t serve customers directly, take them out!

Put the customer in the driver’s seat. Question all costs that can’t be linked to a customer deliverable.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 2.11.12 at 07:55 am by Roy Osing
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February 6, 2012

3 simple ways to make your ONLY statement better

Source: Pexels

3 simple ways to make your ONLY statement better.

The ONLY Statement is the ultimate manifestation of your distinctiveness; of your uniqueness that will separate your organization from your competition.

If you can’t claim that “We are the ONLY ones that…” you’re part of the competitive herd awash with sameness and commodity suppliers

Jerry Garcia, of The Grateful Dead said it this way: You don’t want merely to be the best of the best. You want to be the only one’s who do what you do

If you’re not spending copious amounts of time creating your ONLY, you’re not using your time wisely.

And you’re falling deeper and deeper into the commodity herd.

You won’t be noticed. You will be ignored. You will be dead. It’s just a matter of time.

Follow these 3 steps to create your ONLY Statement.

Speak to what what people crave — Talk to the critical wants of the customers you have chosen to serve — your target market.
Remember it’s not about what you supply to the market; it’s about what your customers desire and want. Do you know the top three things they covet?

People today generally have what they “need”. The battle is over how to address what they “want” in a manner that ONLY you do.

Talk about value — What benefits, solutions, memories, joy, experiences and happiness are you creating? Pushing products and services has no role in The ONLY Statement. We are seeking to claim uniqueness in the way we impact the lives of those we are trying to serve.

And remember, price has no place in the ONLY Statement either. Price claims can never be distinctive. Easy to copy. Commodity behaviour.

Make it specific — At the end of the day, your ONLY has to be delivered by people. They need to clearly understand what it means in granular terms.

They need to be able to determine the appropriate behaviors necessary to “live” The ONLY. Leave helium-filled statements, vision-type claims and aspirations at the door.

“We provide the best customer service” is way off target. Means different things to different people. Probably is untrue. Can’t be measured.

If your ONLY can’t be translated into a detailed picture of what it looks like in the field. Trash it.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 2.6.12 at 11:00 am by Roy Osing
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January 30, 2012

Why you shouldn’t benchmark others if you want a great strategy

Source: Pexels

Why you shouldn’t benchmark others if you want a great strategy.

Benchmarking is viewed as a necessary process for most organizations. There are benchmarking consultant experts and courses you can take to learn how to benchmark proficiently and gain the maximum benefit.

In my view, benchmarking is a simple concept as is its process:

▪️Identify the organization that excels in some aspect of your operations that you believe requires improvement — customer service, business planning, customer engagement, sales management, accounts receivable, advertising planning and so on;

▪️Map (understand deeply) their system or process to understand exactly how they perform the operation;

▪️Define the actions you must take to incorporate their operating system into your operation with the objective of replicating their level of efficiency.

Benchmarking might help you improve your operations efficiency but it won’t make you stand-out from your competition.

Benchmarking can be problematic on several levels:

#1. Benchmarking is copying not strategy

It’s ‘sucking up’ to an organization or individual recognized (by someone presumed to be the thought leader) to be the best at performing a particular function and is therefore the organization you should aspire to be.

It doesn’t make you special. It may help you improve your position in the crowd of hungry competitors by being more efficient at something, but it won’t help you stand out from them by being more relevant or unique.

Copying is the enemy of being different. The maximum benefit you can achieve by copying is best in class levels of performance which may return better operating results than previously obtained but unless you vault beyond these levels true differentiation won’t happen.

#2. Benchmarking keeps you in the crowd, it doesn’t separate you from it

The herd is a place where organizations go to blend in with others; to conform with what others do and to lose the DNA attributes that make them special.

Even if you are the ‘best of breed’ you’re still in the herd. It’s just that you execute a process better than any other herd member; you’re still rubbing shoulders with your sameness brethren.

And because you’re tagged ‘the best’, you have no motivation to break away from the herd; you find consolation in it.

The world is becoming a home for best practice addicts and as a result it’s boring and benign.

#3. Benchmarking is the instrument of compliance

Benchmarking results in conformance; it sucks any unique thinking you may have out of your system and replaces it with the need to capitulate to the leader of the herd.

Rather than look for a unique solution to your problem, you look for another herd member that has put in the work to create a solution that works for them and you assume you can boilerplate it and it will work for you.

When you copy someone or something, you relegate — subordinate — yourself to them. You roll over, put your ‘paws in the air’ and subsume yourself to the leadership of someone else. Looking up when you’re lying on the ground isn’t a very liberating place to be.

#4. Benchmarking won’t differentiate you from your competitors

It has no strategic value in moving the organization to a position in the marketplace that ONLY you occupy.

“What are our competitors doing?” is often asked when organizations are thinking about improving how they conduct business, and the benchmarking process ensues — adding zero space between them and their competitors.

And, of course, if you’re chasing another organization, you’re adding nothing to the kitbag of things that make you ‘special’ in the eyes of your customers and encouraging them to spread your word to others and attract new business.

If you copy someone, all you do is lower the bar.

#5. Benchmarking prevents innovation

If you’re a copycat, you’re not an innovator. Benchmarking does little or nothing to stimulate innovation and creativity which seem to be values organizations covet in today’s world of uncertainty and constant change.

In fact benchmarking kills real innovation because it has performance improvement using the standard of another as its end game as opposed to revolutionary changes that determine new strategic outcomes.

We need to get our thinking straight.

Few organizations today stand out, which is sad; few are deemed to be really special by their customers.
Being remarkable isn’t a strategy on the radar of most, or if it is, it’s an elusive goal because leaders allow people to use traditional tools — like benchmarking best of class — to do their jobs.

Uniqueness, remarkability and being special come from being different than your competitors, not copying what they and others do, even if they perform certain functions more efficiently than you do.

We need to change our ways and stick copying where it belongs.

Let’s:
— Start thinking about being different than best in class, not copying best of breed;
— Covet being ‘different than breed’, not best of breed;
— Think about doing what others are not doing, not looking to other’s successes;
— Go in the opposite direction that others are going, not following in their footsteps.
— Define best in class to be the highest bar to be different from, not emulate;
— Purge boilerplates from our toolbox and break new ground (and maybe be the author of a new boilerplate).

Copying is the enemy of being special and remarkable.

And as leaders, let’s change the conversation in our organizations; purging the notion of benchmarking and copying as ways of achieving strategic progress by asking these types of questions of our teams:

▪️”What can we do to be different from the crowd of competitors?”;
▪️“How does what you’re proposing make us stand out from the competition and be special to our customers?”.
▪️“What crazy ‘insane’ thing is a different business to ours doing and how can we use the basics of the idea to morph it into a special idea for us?”

Benchmarking is absolutely the wrong thing to do when the end game for most organizations seems to be uniqueness and remarkability, but there are ways to ‘bend the curve’ and go in the right direction.

Start the change now, though, because time is not your friend.

Cheers,
Roy
Check out my BE DiFFERENT or be dead book series

• Posted 1.30.12 at 10:20 am by Roy Osing
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January 16, 2012

3 practical ways to ‘bloody-up’ your business plan

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3 practical ways to ‘bloody-up’ your business plan.

Your strategic plan document should not look pretty.

Pristine. Like the pages have been bleached and ironed. Like you haven’t looked at it since it was created. Probably a year ago.

Rather, the document should look like it has been used. Used a lot. To record what you have learned while trying to execute your strategy. In addition to a statement of direction, your business plan document should be viewed as a repository of learning.

Here are three ways to do it:

1. Record results constantly — As you implement your strategy, what worked? What didn’t? Why? Write it down: in RED if the outcome was NOT on plan; in BLACK if things worked out as planned.

Clarify the implications of falling short of your objectives so you can take corrective action. Evaluate what worked well with reasons so it can be repeated.

2. Work in the document daily — Refer to your plan everyday. Make a point of commenting on some aspect of it. Study your notes. Call a meeting with colleagues to problem solve an important matter.

3. Shout out the negatives — Executing any plan is neither nice nor tidy. It’s a messy business. Progress is extremely Inelegant. People get hurt. They get frustrated. They sometimes get stressed out.

That’s the way it is. And it needs to be told that way. People won’t believe that the plan is going along well and that there are no bumps being encountered.
Keep it real and honor those Heroes who been relentless in squeaking out progress in the face of painful odds.

And, if after religiously following these 3 tasks you have not messed up your plan document - blood stains from paper cuts, coffee stains, dog-eared pages and barely legible notes on every page then it’s clearly of no value to you and you are getting nowhere implementing it.

Bloody it up!

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 1.16.12 at 10:00 am by Roy Osing
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