Surrendering Market Space

Any car

There was a radio commercial the other day with the following line:

“We’ll beat your quote from a well known car buyer”

So that’s one company referring to a second company but without mentioning to that second company by  name.  At what point did they realise that the other brand was so strong, they didn’t actually have to name it, since it would be obvious through context to anyone listening which company they were referring to?

It implies that, for the intended audience, it’s the unnamed brand that is the strongest in that market sector for that product/service, not the company that’s chosen to advertise.

So did the company who commissioned that spot realise that they’ve surrendered market space to another brand? Was this an attempt to gain market share by encroachment through undercutting (“we do the same job for you as Company X, but we’re cheaper/provide better value”)?

It’s an odd strategy to take and I can’t think of a company that has survived longer-term with that approach.

Looking at Mintzberg’s 5Ps, we can see that as a strategy as a position, although the position taken or aimed for is usually a stronger one. Instead, this creates a competition of price and the resulting race to the bottom.

Where Do I Learn? – Part 2 – Books

Books

If I’m driving, I’m listening to podcasts. If I’m travelling by train, then I’m reading.

I typically read books that don’t directly relate to my profession, but those that I hope will change my approach to how I work with clients.

For every client I go to, I end up mentoring business analysts, business architects, programme manager, project managers and other change programme staff. So I’ve kept a list of references (not just books) on Evernote and I tailor it to the person I’m mentoring at that time.

Here’s the list of books that I recommend:

1. Lean

Production Line
Production Line

1.1. Womack and Jones: Lean Thinking: Banish Waste and Create Wealth in Your Corporation

This is the book I recommend to anyone trying to understand lean for changing services and organisations. However, once you understand, you’ll start applying it to other areas of your life. There’s a lot of argument in the field about whether this is really Lean, TPS or some other methodology. At this stage, if it’s your first introduction to field, this is a great book to start with. You won’t be an expert by the end of it, but at least you’ll understand more and be able to understand some of the differences in the arguments.

1.2. Womack and Jones: Lean Solutions: How Companies and Customers Can Create Value and Wealth Together

The 3rd book in the series by Womack and Jones. Most useful for service industries and how to value the time of the customer more. Sometimes this is the book that makes the reader sit up and go “I get it now”, especially if they’re working in health or social care.

1.3. Womack, Jones and Roos: The Machine That Changed the World

The first book in the series. It’s the book that introduced the term Lean to the world (although the term had been in minor use before that). It’s useful if you’re interested in the history and how automobile manufacture has changed. If reading, get a later edition due the updates. The world has moved on since it was written, so usually I’d say it’s only worth reading if you’re interested in the subject and want to read about the case studies. But there’s an element of learning about some of the issues faced by companies as they implement lean for the first time.

2. Lean – More Advanced

Production
Production

2.1. David Mann: Creating a Lean Culture: Tools to Sustain Lean Conversion

This book is useful since it covers a lot of ground that is missing from the Womack and Jones books; mainly that there has to be a culture to make it happen and foster the long-term improvement. So David focusses on the role of the manager and what they need to do.

2.2. The Lean Toolbox for Service Systems

Probably the driest book in this list, it’s worth persevering with. There are some gems of ideas in there. I tend to offer it more as a reference to analysts to pick and choose from, rather than read the whole book. Note that I don’t pay that much attention to the process part of the book; but the principles are still sound in that we should choose different methods and tools at different levels of granularity and purpose.

2.3 Michael L. George: The Lean Six Sigma Pocket Toolbook

Nicely summed up by it’s streamline: “A Quick Reference Guide to 70 Tools for Improving Quality and Speed”. It’s a small book with each tool described, how to use and when to use it. Useful to have at arms-length when checking which calculations should be used, especially if you’re not conducting them every day.

2.4. Toyota Kata – Mike Rother

https://www.amazon.co.uk/Toyota-Kata-Managing-Improvement-Adaptiveness/dp/0071635238/

One of my favourite books in this list. This includes tales and case studies highlighting the real root of TPS, in terms of how mentoring and problem solving are achieved and how they are intertwined. This is a necessary complement if you’ve started out with Womack and Jones.

2.5. Lean Enterprise – Jez Humble, Joanne Molesky & Barry O’Reilly

https://www.amazon.co.uk/Lean-Enterprise-Performance-Organizations-Innovate/dp/1449368425

An interesting book that takes learning from Toyota Kata + Cost of Delay + agile and continual improvement on an enterprise scale. It provides a way for structuring your business from a prioritisation, problem solving and personal development perspective. I’d suggest starting with Toyota Kata first and then reading this one.

3. Influence and Sales

3.1 Robert Cialdini: Influence: The Psychology of Persuasion

Out of all the books I recommend to anyone I’m mentoring, this is usually at the top of the list. Partly so that we can talk about the same concepts and understand how we’re being influenced (and how we can influence others). It doesn’t matter if you don’t use it at work, you’ll find a use for it when buying your next car, watching how supermarket designers manipulate your thinking, etc. Even in the RNLI station/shop in Blackpool, I noticed 3 of the principles being used on one display stand.

3.2. Robert Jolles – Customer Centered Selling

This is easily the best book on selling that I’ve ever read. He describes a process, and while we’re all human and don’t follow always follow processes, it’s really useful to know what’s expected at what stage and what’s missing if you’ve jumped straight in.
There are a few editions of this; all out of print, but some are more available than others. And check eBay and Amazon used.

3.3. Chris Voss – Never Split the Difference

Chris’ book is close to the top of my list for books to recommend to business architects and business analysts. There’s little point doing a great job from your professional domain if you can’t influence others to accept your way of thinking. That’s not to say that you should manipulate others, instead it’s to give your work a fair chance of being heard and an opportunity to be adopted.

3.4. Roger Fisher: Getting to Yes: Negotiating an agreement without giving in

Based on the Harvard model of negotiation, including Best Alternative to Negotiated Agreement. It concentrates on creating the framework first before discussing points. So agree how you’re going to agree before you start talking the specifics of the deals.

3.5. Dan Roam: Back of the Napkin: Solving problems and selling ideas with pictures

Can’t draw, have difficulty communicating ideas? Then have a look at this book for understanding the simplest type of diagram to draw for any situation. It’s here on this list because many of the pivotal moments when you’re describing your ideas can be accelerated by use of the appropriate diagram. Pay particular attention to the SQVID.

3.5. Joe Navarro – What Every BODY is Saying: An Ex-FBI Agent’s Guide to Speed-Reading People

The best book I’ve read on non-verbal communication and body language. There’s a simple theme running throughout the book; you can’t tell what someone is thinking, but you can tell if there’s a disconnect between their non-verbal communication and their communication.

4. Education

4.1. Josh Kaufman: The Personal MBA: A World-Class Business Education in a Single Volume

I’m often mentoring change professionals who, while they may be great at their chosen profession, don’t understand accounting practices or how decisions are made. So I direct them to these two books. This is the shorter one; quicker to read and digest.

4.2. Steven Silbiger: The 10-day MBA: A step-by-step guide to mastering the skills taught in top business schools

The second of the two general business books I recommend. This has more detail than the Personal MBA but also may require guidance due to the complexity.

5. Entrepreneurship/Innovation

innovation
innovation

5.1. Eric Ries: The Lean Startup: How constant innovation creates radically successful business

I find that this book can change the reader’s approach to large-scale programmes. It makes them think more about incremental change based experiments. I also find that I still have to remind mentees about the purpose of experiments, i.e. to validate learning. But if they’ve read the book, it’s absorbed easier with that gentle nudge.

5.2. The Startup Owner’s Manual: The Step-by-Step Guide for Building a Great Company – Steve Blank and Bob Dorf

Kindle is usually significantly cheaper than the paperback/hardback.
The Startup Owner’s Manual deserves more fame than it has. It’s unfortunate that it’s been somewhat eclipsed by the Lean Startup, since it has significantly more usable material in it. That hightlights the differences; the Lean Startup is a book that promotes the culture and activities, whereas the Startup Owner’s Manual is a guide to the activities that you have to follow. Admittedly, it can be a bit daunting to read at first, since it comes across more as a reference guide that you can dip in and out of. This is the book to read to understand the concept of Customer Development.

5.3. The Lean Entrepreneur: How Visionaries Create Products, Innovate with New Ventures, and Disrupt Markets

If I know you’re an entrepreneur or a startup founder, then I recommend this book above all else. It takes the learnings from a lot of other sources and puts them into one practical book. So expect to see references to the Lean Startup, Customer Development and Business Model Canvas as well as tables that you use to record and plan your own progress.
Pay attention to the reverse planning process; it’s important to know where you want to get to and then work back from there.

5.4. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers

Alex Osterwalder has started a movement and initiated a number of more domain-specific spinoffs. If you have a problem you can probably find a canvas for it now. This is the book that brought canvases to us, taking a simplistic view of business architecture and making it accessible to all.

5.5. The Mom Test – Rob Fitzpatrick

A short book, but it doesn’t miss anything out. If you’re conducting user/customer interviews, you should read this book first. Ideal for users researchers in service design/design thinking and for startup founders. Don’t be fooled into believing what your customers say; they have other motives, so it takes a different approach to obtain the information you require.

6. Business Strategy

Chess
Chess

6.1. Richard Rumelt – Good Strategy/Bad Strategy: The difference and why it matters

This includes so many case studies regarding how to set strategy. It’s a fascinating read. Main point to take away is that a good strategy includes 3 parts:
  1. An analysis of the current situation
  2. A vision of the future
  3. A plan to achieve that vision

6.2. Michael E. Gerber: E-myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It

At the other end of the scale from Good Strategy/Bad Strategy, Michael discusses small business strategy by using a small bakery as a example throughout the book. It does focus on franchising as a solution in the second half. It’s a useful book for small business owners, helping them think about the processes and systems they need to have in place.

7. Change

Butterfly
Butterfly

7.1. Richard Wiseman – 59 Seconds: Think a little, change a lot

Change yourself in less than a minute. That’s the main concept behind the book. Richard takes us through a journey, referencing many studies across the last few decades and how we can learn from them to influence our own lives.

7.2. Richard Wiseman – Rip It Up: Forget positive thinking, it’s time for positive action

The follow-up to 59 seconds. It’s actually the more practical book out of the two, but it makes sense to read 59 seconds first.

8. Facilitation

Session
Session

8.1.Understanding Facilitation – Christine Hogan

https://www.amazon.co.uk/Understanding-Facilitation-Theory-Principles-Principle/dp/0749438266

Christine covers a lot of ground in this book. She educates about the history of facilitation, different forms of it and how it has progressed. This is a must-read for facilitators.

8.2. Practical Facilitation – Christine Hogan

https://www.amazon.co.uk/Practical-Facilitation-Techniques-Christine-HOGAN/dp/0749438274

In the second book I recommend from Christine Hogan, she introduces tools and techniques for facilitating. This is a good read and worth keeping to hand as a reference guide when you’re starting out in your facilitation experience.

8.3. Sue Knight : NLP At Work

I wondered whether to include this since I don’t actually believe in NLP. There just wasn’t enough scientific evidence at the time I looked into it to prove it worked. However there have been times with facilitators who have had difficulties with some of their customers that I’ve recommended certain parts of this book. Critically, the concept of reframing has helped numerous analysts continue working with customers rather than going home stressed at the end of the day. It’s helped them realise where the problem could lie and, more importantly, that it doesn’t lie with any of the people.

Where Do I Learn? – Part 1 – Podcasts

microphone
microphone
microphone

I regularly listen to podcasts. If I’m travelling between clients, I’ll usually be listening to a stream of podcasts. Even when taking a shower or eating breakfast, I can have a podcast playing in the background.

I used to listen to a lot of podcasts as I drove between client sites. The podcast format was ideal for the time behind the wheel and expand my thinking for the few hours that I was on the road. So I had a variety of subjects and presenters. Over time, I’ve narrowed the list down to :

1. Podcasts with a focus on sales

I’m not from a sales background, although I have worked on bid teams, and pre and post sales teams. Yet I fully believe that a significant part of a consultant’s job, especially those such involved in innovation, business architecture, business analysis and change management, is to sell the ideas to stakeholders. I don’t think of this as used-car dealer selling, but more ethical selling. More akin to Rob Jolles’ concept that selling is helping a potential client to arrive a decision quicker than they would have without your involvement, even if they decide not to purchase from you. I’ve seen numerous good ideas fail because the consultant didn’t spend enough effort on selling to the stakeholders. So I include 3 sales podcasts in my list.

1.1 The Salesman Podcast

Will Barron’s daily interview podcast, largely focussed on B2B sales. Although the guests are international, there’s often a UK perspective which isn’t present in many other podcasts. You do hear a number of guests that are doing the podcast circuit, but you definitely get a B2B sales focus and usually a different angle to what you may hear on other podcasts.

Link: The Salesman Podcast

 

1.2 The Sales Podcast

The Sales Podcast with Wes Schaeffer. These are shorter episodes but with a slower, more considered approach. I find the content in this more cerebral than in the Salesman Podcast. More importantly, this has a wider focus, not restricted to B2B sales.

Link: The Sales Podcast

1.3 The Sale Evangelist

These are usually short sessions with a few common themes across the podcasts. The Podcast series is hosted by Donald C Kelly, with short 5 minutes episodes, mixed with more in-depth interview episodes. The mix is refreshing and motivational. The only problem I have is keeping up with them so invariably I miss a few.

Link: the Sales Evangelist

2. Innovation

2.1 The Innovation Ecosystem

This is the only pure innovation podcast that’s remained in my list. I introduced it to my list as I found that the rest of the podcasts had a skewed bias and I still wanted to keep up-to-date with innovation within larger corporations. I like that the interviews are with the people who are introducing innovation within larger organisations, rather than just the standard series of podcast guests appearing on other podcasts.

Link: the Innovation Ecosystem

2.2 The Twenty Minute VC

Not purely about innovation, but about investment, specifically venture capital. This ties together the themes for me of innovation and startups. It’s short (designed to be short enough for a commute) and full of information with a high calibre of guests. In listening to it, I gain further insight into the world of less-mature organisations and advice given to them.

Link: The Twenty Minute VC

3. General

3.1 The Jocko Podcast

This was the first podcast I listened to, well actually I’d heard about Jocko Willink and listened to his interview of Steve Austin’s podcast (so that was the first one), but Jocko is the first host that made me click ‘subscribe’.

Jocko Willink is an ex-Navy Seal commander, now martial arts gym owner, public speaker, author, business consultant and seller of tea. His episodes typically include him reading excerpts from military books (usually military history and first-hand writing where possible), commenting on them and then a question and answer slot at the end. More commonly the Q&A is appearing in a following episode. These are long episodes, easily over an hour.

I continue to listen to these because I agree with 80-90% of his business perspective and I find that he has a clear insight into how to resolve problems. Often that takes the form of reframing the problem from the original question. It’s a similar approach to what I take and it’s good to hear someone from a massively different background doing similar.

Link: The Jocko Podcast

3.2 Ted Talks

They’re short (designed at less than 18 minutes) across a number of themes. Easy to digest and easy to listen to at an increased speed.

Link: Ted Talk Audio

Is this a bad time to talk?

Shhh!

There are times to make people feel comfortable, to help them feel that the change is achievable. There are also times when we need to remove that comfort and destabilise temporarily, so that they can work towards a solution. We commonly reintroduce comfort, or better still guide the audience towards discovering the own new level of comfort.

On a smaller level, that element of something not being on script can be incredibly useful.

Context

Think of those situations when someone has spoken out of character for the event. They’ve gone off-script and either talked about something not relevant or worse completely inappropriate for the situation. To borrow an example from the television series Frasier, I remember Martin Crane, the retired police officer, opening up a conversation at a dinner party talking about human entrails when asked about the buffet “Isn’t this the worst thing you’ve ever seen?”. The point was that it was the wrong thing to say, it made the rest of the party guests uncomfortable. He didn’t respond on-script as was expected.

Another example we’ve all experienced would be opening by discussing “How are you?” If the person responds with negative comments about their day or health, there’s usually a moment of awkwardness where you’re waiting to see if they come back on script. This is usually regardless of how much you care. Even if you care a lot about the person, it’s still awkward if you had only said “Hi, how are you?” as a typical greeting. If they continue the off-script information, again we get that deeply uncomfortable feeling, much like Martin Crane’s audience. If they return back to on-script, then all is well and you can address any concerns that they had raised.

But we can harness some of that off-script without alienating our audience, without making them uncomfortable.

An Approach from a Former FBI Lead International Kidnapping Negotiator

I came across Chris Voss through his book on negotiation. It’s an amazing book and easily one of the top 10 books I’d recommend to anyone starting out in business change, business analysis, etc. Most of those jobs are about people, not the technical aspects, so if you can interact better with people, then you’ve got a head start on your other analytical/change colleagues. If you haven’t yet read his book on negotiation, then do so. It’s full of useable advice, ranging from small of this type of scale to larger pieces that may change how you regard the practice of negotiation.

When I mentor, I ask how the mentee prefers to learn. Some want the quiet time of a book, others want to listen to podcasts. Increasingly common is the option of learning through videos. The most common overlay on all of them is the wish to learn by doing, shortly after learning the theory.

So I set off to see what videos I could find of Chris Voss online. And there is some formidable content available, ranging from Google presentations, to his interview with Lewis Howes and a significant number of other videos, all of them valuable.

I came across one nugget in the videos that I hadn’t read in the book and it’s it’s amazingly simple.

In his interview, he mentioned that instead of asking “Is this a good time to talk?”, we should ask “Is this a bad time to talk?”. He followed this up with stating that it’s because the person has to think about how they answer and that they’re in the position of agreeing, it’s a bad time and then having to suggest a better time. Whereas if you ask if it’s a good time, they can respond with no and the option to re-engage is with you.

Try it

I’ve tried it and it was a very informative experience. I noticed that my partner in the conversation started to respond (probably to the question that I hadn’t asked “is this a good time to talk?”), then checked himself, paused, thought, then had to rephrase his responds to fit the question. It worked, I’d convinced someone with a full diary to spend 10 minutes unscheduled time with me on the phone at 9am on a Monday morning.

I intend to keep using it in the hope that it doesn’t become the new norm where it loses it’s power of being different.

Bonus

A couple of relevant videos for you, referred to above and embedded here

 

3 Reasons for Running Sales Campaigns

Context

A friend the other day suggested that he drop his prices for a few weeks and I questioned what the rationale was behind the intended price drop. I wanted to check that there was a valid reason and it wasn’t just a knee-jerk reaction that led to the idea of creating sales campaigns.

Sale on green
Sale on green

I only know of 3 reasons for sales. I’ll define sales as campaigns based on a short-term price reduction, such as end of season sales, January sales, etc. To be clear, I’m avoiding discounting and similar activities to keep specific customers happy and/or make the sale which I see as a different set of activities.

The 3 Reasons for Sales Campaigns

1: Due to Inaccurate Estimates

The provider chain (including the parts supplier, manufacturer, distributor and/or retailer and any combination of the above) has inaccurately estimated the amount that customers will buy at the RRP. So they need to shift stock rather than have it build up in the warehouses or showrooms. This sometimes occurs because a new model is coming out or because the weather was as predicted (and so not as much ice-cream was sold the week before). The answer could be that the MRP/RRP was always too high for the market and so the price drop is, in effect, a reduction to a more valid price that the market can sustain.

2: To Acquire Customers

Another reason for limited campaigns is as the basis for lead generation in terms of selling nearer to cost or at a loss to acquire new customers. A reduction during the campaign can lead to a long-buying customer that otherwise could have been tempted by competitor offers. The typical view is that a the price of the reduction is vastly outweighed by the long-term revenue from the customer. However this should be validated in your own organisation. In some sectors, customers are increasingly becoming used to jumping from competitor to competitor, getting the new deals available only to new customers.

On that subject, it is also worth considering the aspect on existing customer. Some may feel maligned or forgotten, depending on how important the price reduction would have been to them.

3: Short Boost

To create a boost in what customers are buying for a short period of time. This could be to alleviate a cashflow issue, e.g. to avoid company administration or pay annual tax bills, etc, or could be to alleviate another pressure, e.g. warehouse needing emergency repairs so some stock needs to be removed (and sold) rather than stored. In the case of cashflow, this could have been considered as a subset of (1), in the money is the resource. However considering many of the instances requiring short term boosts are unforeseeable, the boost is instead intended to be used as a stabilising factor.

4: Shift unused resources

In most industries, there are resources that do not generate revenue if not  being actively used, but the companies need them available in case of larger contracts. For instance, telcos provide ports to corporate customers, the number is static so spare, unused capacity could be packaged into a campaign. Similarly, larger consultancies operate a bench (usually quite lean) with consultants who are not actively being resold to clients. However this this is just another form of (1). Had the company planned better, then these resources wouldn’t be spare. So we remain with 3 reasons.

Further Thoughts

The better the company at predicting and responding to the future needs of its customers, the fewer sales campaigns it will require. This does require the company to act on those forecasts.

The issue with (1) is that while it makes sense, there should be an associated activity. This secondary activity should be to look at whether the assumptions in the original plan are accurate in hindsight and whether they should stand for future forecasts. For instance, if you’re reducing your price to meet the market expectations, then actually that’s your price, not your originally-inflated price.

So you’re about to run a sale, which reason are you using?