Within our free-enterprise system, we are all looking for the same thing—the “best deal.” When we buy goods, services, and even when we hire employees, we want to get the greatest value we can for the time, effort and money spent.
It should be no surprise that our customers and employees are also looking for the best deal from US! However, the best deal may not be what you think.
What is the Best Deal?
Many people equate the “best deal” with the “best price.” Business owners are often committed to having the “lowest price in town.” Many of these owners also struggle to survive because their operating margins are too low. What they fail to realize is that customers looking for the best deal are not necessarily insisting on the lowest price.
Customers reward companies that serve them best, and allow the others to fail. It is how the customer feels about your business as a whole that matters most. Everything about your business—advertising, cleanliness, return merchandise policy, courtesy and knowledge of employees, product selection, price, location, delivery time, and so forth—is what they are choosing. Your entire business is your product, and it must shine throughout. When it does, YOU become the “best deal!”
High Value is Better than Low Price
Sometimes pricing does play a role in helping companies become the best value to their customers. Legitimate price advantages do happen. I am acquainted with a landscaper who is the owner of a local rock quarry. He has a significant price advantage over other landscapers who must transport boulders a greater distance.
However, the cry, “We have the lowest price," is often a sign of weakness. Translated, it usually means the business has not invested in marketing, quality people, killer customer care, and other expenses incurred by well-run companies. Remember, everything about your company is what makes it the best deal—OR NOT.
When I grab a quick lunch during the day, I sometimes go to a sandwich shop that is close to my office. I can get in and out quickly. The prices are relatively low, and no tip is required. At that moment, the sandwich shop is the best deal for me.
On the weekend, I take my wife out to dinner at a steak house restaurant. I will pay three or four times as much for a meal there as I did at the sandwich shop. This popular uptown restaurant has a nice ambiance, provides an unrushed full-course meal, and I am able to court the love of my life. At that moment, the steak house restaurant is the best deal in town.
On our wedding anniversary, I took my wife to an exclusive restaurant in Salt Lake City. I paid an outrageous price, but it was a night she will never forget. Of the three restaurants, this one provided the greatest value of all: a lifetime memory.
So, the best deal in this case is not related to price. Instead, it is the highest perceived value based on my current need. At each restaurant, I wear the hat of a different customer with different needs, and I have a different definition of what is the best deal.
Since no business can serve everyone well, it is important to define your target customer and then provide real, quantifiable, and compelling reasons to buy from you. You want your target customers to see you as the best choice available to them. If you own the exclusive dinner restaurant, you don’t care about the guy who wants a cheap chicken sandwich. No other customer matters except your target customer!
Remember, if your competitor offers a greater value than you, customers will buy from him or her. And don’t think you can make up for the value deficit by trying to “out-sell, out-trick, out-technique, out-cold call, out-persist, and out-luck all your competitors” (Rick Harshaw, Monopolize Your Marketplace). Today’s consumers know value when they see it. You simply must be the best in your target market. Period!
Innovation Can Set You Apart
You become the best by constantly innovating. Innovation is the process of figuring out how to offer more value than your competitors. Innovation is not doing something cool that your competitors also do. It is not giving your customers what they have come to expect as the status quo, or offering a gee-whiz promotion from time-to-time.
Innovation is not necessarily a new invention or business concept. It may just be as simple as outrageous customer care (Costco), or delivery times that amaze (FedEx), or an exceptional warranty (Hyundai).
Your value may simply be a result of your well-crafted business systems—the distinct and remarkable way you do things from end-to-end. By the way, when your people, products and processes work together in a unique and memorable way to make you the best deal, you have a brand.
Ask yourself one simple question: If I were a customer of my business, what would compel me to buy from me instead of my competitors? If you don’t know the answer to this question or aren’t willing to pay the price to get it, your business could be in danger. Get in the Zone today and figure it out.
Become Remarkable
Because there is a cost to becoming the best, the customer actually pays a premium for the privilege of doing business with remarkable companies. However, customers must think it's OK because they keep coming back.
Remember, your business as a whole is what makes you the best choice. It’s the little things that count.
Be clean.
Be prompt.
Be consistent.
Be courteous.
Be knowledgeable.
Be dependable.
Be responsive.
Be innovative,
Be systemized.
Be remarkable.
And you will be the BEST DEAL!
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“You are surrounded by simple, obvious solutions that can dramatically increase your income, power, influence and success. The problem is, you just don't see them” (Jay Abraham, marketing consultant).
Let’s talk about a simple strategy that will help you harvest an abundant crop of new ideas that are sure to motivate employees, give customers a better buying experience, and increase financial results and rewards.
Though perhaps unnoticed, the people around you possess a wealth of experience, talent, insight, and creative ideas that are just waiting for the right opportunity to be shared.
Sadly, many useful and innovative thoughts that could improve your business are never expressed. Why? You don’t have a system to tap into the collective intelligence of workers who are intimately involved with your business operations; this includes the average everyday folks that rarely speak up.
Everyone in your organization is potentially a problem-solver and an innovator. If you have an idea-rich culture of continuous learning and improvement, your employees are always thinking: "How can I do this easier, faster, better or less expensively.” Researcher Alan Robinson says ideas are "free" and employees will gladly make improvements as part of their job if the environment you create is right.”
So what kind of system can you create to harness the knowledge, imagination and renewable energy of your employees?
Some companies have tried putting up a suggestion box. Employees write suggestions on a form and drop them in a special box. Managers (sometimes) read the suggestions and implement the ones they think will work. However, suggestion boxes typically aren’t very effective. They allow anonymity leading to frivolous suggestions or mean-spirited remarks. They focus on problems but not necessarily solutions, and solutions are not always feasible. They often suggest more work for other people who are already busy, and thus no action is taken. And this old-style system usually doesn’t reward successful implementation and sustained results stemming from the suggestion. There is a better way!
Your Employee Involvement Program
Here are some ideas to implement a business system that will solicit real improvement ideas, generate enthusiasm from employees, and save or earn your company thousands of dollars over the coming year.
- To begin, let’s get rid of the “suggestion box” and replace it with a filing system by worker name. After all, we expect every person to submit many suggestions (see #2)—often small ones— over the course of a year. It’s also a good idea to review the employee’s file of suggested improvements during evaluations or other interviews.
- Next, how about giving the system a new name—something that emphasizes solutions instead of merely suggestions. You could call it the “business improvement program” or the “employee ideas program.” If those sound a little lame, have a brainstorming session or contest to name the system. Let me know what you come up with.
- The person with a new idea for a solution or improvement completes a brief form (get a sample form in The Zone) and hand delivers it to their supervisor or someone who could provide the time and resources needed. Good ideas might help with cost savings, productivity, process improvements, revenue-generation, and so forth. A brief plan to implement the proposal is also included. The merits of the idea are discussed, and an action plan generated.
- Ideally, the submitter of the new solution should be responsible for its implementation. Ownership increases the likelihood of success. Active participation by the submitter removes one of the major complaints with the old suggestion box: “I gave the company a good idea, but they didn’t do anything with it.” Lack of action kills the motivation of any improvement program.
- Always thank employees for their time, effort and feedback. Positive reinforcement will keep the good ideas flowing. Create a reward system for people whose ideas are successfully implemented. Frequent acknowledgment of small improvements is more effective than occasional recognition of a few. Consider a gift card, day of vacation, or tickets to a sporting event. When others see that good ideas are rewarded and appreciated, they will join in. If appropriate, give financial compensation, perhaps some when the solution is first implemented and the rest over time with proven results. The reward system helps the submitter maintain ownership and a vested interest in assuring that the new solution is understood, accepted, and practiced by everyone.
- If you want to create a little healthy competition, do something visible like posting a chart that shows the number of ideas submitted by each person, team or department. Be creative. Recognize winning ideas in your weekly Business Improvement Workshop. Celebrate achievements with something like a pizza party.
- Maintain a simple log of new ideas presented, the person’s name, and date implemented. This helps the supervisor know what is going on at a glance and allows for a frequent review of progress. Again, talk it up at the Business Improvement Workshop.
Never Stop Improving
Get connected with your knowledgeable, imaginative, inspired, resourceful, eager-to-contribute employees who are quietly working in their cubical or on a production line. Capitalize on this great hidden treasure you are already paying for.
Every little improvement—hundreds a year— will make your business better and better, until one day, you have a smooth-running, people-pleasing, money-making system!
P.S. - Get the "Business Improvement Suggestion Form" in The Zone.
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To a Systems Thinker, there is a significant difference between a business process or procedure and a growth-producing, customer-pleasing, waste-removing, profit-generating, business system.
In addition to the six qualities of effective business systems described in the Box Theory™ Way, a seventh factor can make all the difference, boosting system performance and making your entire business remarkable.
Let’s call it the WOW Factor!
Nowadays, we are drawn to people, products and processes that can be described as impressive, engaging, memorable, even head-turning, jaw- dropping, or spectacular. When people have an intensely positive reaction to something about your business, you’ve got a WOW Factor!
So, here are a few suggestions to get that WOW thing going in your business.
WOW Your Customers
- WOW Factor #1: Take the Lead – Innovate new products and services. Add or improve features and benefits. Expand technology. Be the first to market. Disturb the status-quo. Set the de facto standard. Become the best-in-class. Develop a game-changer. Introduce the next big thing. Differentiate yourself from competitors. Dominate your target market. In some way, become a standout!
- WOW Factor #2: Become the “Best Deal” – Make your products, services, or customer experience easier, better, faster or cheaper than your competition. Provide superior quality or workmanship, the fastest delivery time, widest product selection, or a legitimate price advantage. Offer exceptional value, the most convenience, or best guarantee/warranty. Your entire business is your product and it must shine throughout. When it does, YOU become the “best deal"!
- WOW Factor #3: Dazzle the Senses – Create a strong marketing “sensory package.” Engage multiple senses—sight, sound, smell, touch, taste. Become a customer magnet—engaging, fun, entertaining, motivational. Tell relevant humorous or inspirational stories. Tease or arouse curiosity. Champion a cause. Offer a new vision. Be distinctive, thought provoking, dramatic, or even controversial. Razzle-dazzle your customers. Get inside their heads and hearts!
- WOW Factor #4: Offer Overwhelming Proof – Take away all doubt about the value or your product or service. Include testimonials, eye-opening case studies, enthusiastic reviews, demonstrations, samples, or no-risk guarantees. Provide statements of authorities, facts, or statistics to prove your claims—the more interesting, shocking, surprising, and compelling your facts and figures, the greater the WOW Factor. Make your case so convincing that the customer’s decision to buy from you is a no-brainer!
- WOW Factor #5: Impress with Exceptional Know-how – Preparation, knowledge, expertise and professionalism produce immediate confidence with customers. People want to do business with those they trust—those who inform them, teach them, or take them by the hand and show them exactly what to do. Become the best resource to solve their big problem. Take away their worry or frustration. Make their task easier. Lighten their burdens. Encourage and reassure customers that they have come to the right place.
- WOW Factor #6: Give Killer Customer Care – Provide a fast resolution to customer problems. Apply the Golden Rule (treat customers the way you would like to be treated). Go the extra mile. Exhibit a high degree of fairness and integrity. Give the most value you can for every dollar the customer spends. Systemize customer-service processes for consistency and reliability. Deliver on your sales promise, and exceed expectations if possible. Continually seek ways to surprise and delight your customers!
There Is No Other Way
The only way to add a WOW Factor to your business is to incorporate it into a system component or procedure. There is no other way! So, go ahead and apply some of the suggestions above to boost your business revenue and profit with supercharged business systems.
Next week were going to apply the WOW Factor to your internal customers, your employees and business processes.
Related Articles:
The WOW Factor: Six Ways to Supercharge Your Business Systems! (Part 2)
Turn Dust-Gathering Procedures into Business Systems that Wow!
Business Systems vs. the Misunderstood Operations Manual
Boost Your Business Profit by Adding the Fun Factor!
Does Your Business Have a Double McTwist 1260?
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The Systems Thinker does not always know the right answers, but he is one who asks the right questions. Effective questions are the key to problem solving, innovation, and unlocking your full potential. In fact, enlightened questions often point to enlightened solutions.
It takes as much skill to ask the right question as it does to give the right answer!
Never Stop Improving!
When drilling down on a problem (5-Whys), or conducting a business improvement workshop, here are a few questions to get people thinking and energize your team.
- What is standing in our way of being a much better company?
- What new market opportunities can we exploit? What other business strategies would increase market share and growth?
- What does our target market want that they are not currently getting? What innovative products, features, benefits or services could we add?
- How do we plan to get more customers? How can we sell more to each customer (cross-sell or up-sell)? How can we make our customers more aware of all our products and services?
- What are our most frequent or difficult customer service questions? What gives our customer the most pain or causes the most complaints in doing business with us? How can we give the customer a more pleasurable buying experience? What specifically are we doing to create loyal customers?
- How can we provide better quality products or services than our competitors? How can we deliver faster than the market norm? What can we do to reduce cost or give more value to customers than the competition? (Better, Faster, Cheaper).
- What business systems and processes must we excel at? What system most needs improvement? What new systems would add value to our market and attract new customers? What new system or process would rock our industry (e.g. FedEx overnight delivery)?
- How do we plan to attract the best employees? What can we do to retain loyal employees? How do we provide a better place to work? What would help employees become more empowered or productive?
Asking questions of customers or employees not only provides valuable information, it shows that you have a genuine interest and respect for the ideas and opinions of others. If you listen carefully,
wanting to be taught, people often reveal information that can dramatically
improve your businessand bottom line.
Asking questions is also the best way to teach. In the words of a professional trainer, “To tell is to preach. To ask is to teach.”
Chet Holmes, a well-known marketing and sales teacher uses questions very effectively. Go to THE ZONE and check out his three page article, “Creating Great Businesses.” Chet gives an example of how he helped one business implement nineteen important improvements, all stemming from a single question.
So, what question would get your team fired-up to make improvements?
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From 1985 to 1992 there was a popular television character known as MacGyver. He was a secret agent with a scientific background and an unusual knack for solving urgent and often complex problems with simple everyday materials he found laying around. Of course, he was never without his duct tape and a Swiss Army knife. In every episode, MacGyver would jerry-rig a clever contraption to accomplish his purpose and save the day.
Years later, people still refer to MacGyver when using chewing gum, a paper clip, duct tape, or whatever is simple and handy to solve a pressing problem.
A MacGyver Moment
One of my MacGyver moments came when our family moved into a new house that had an unfinished basement. When it began to rain, I was distressed to find water running down one of the concrete walls and flooding the basement floor. I grabbed an empty fifty-five gallon drum left from construction and pushed it up against the wall to catch the running water. However, the drum could not sit close enough to prevent water from running behind it.
I looked around in storage boxes and found an old 16x20 picture with glass in the frame. I removed the glass, set it on top of the barrel rim, and leaned it against the wall. I then applied duct-tape to seal the top edge of the glass and hold it in place. The water cascaded down the wall, hit the glass, and successfully ran into the barrel. However, within a few hours, the barrel was three-quarters full and too heavy to move. And it was still pouring rain.
From our garden shed, I grabbed an old hose, dropped one end into the bottom of the barrel, and ran the hose out the sliding glass door to a low spot in the backyard. I then sucked on the end of the hose to start a siphon. At that point, the barrel began to empty at about the same rate it was filling. We continued to have torrential rains for three days. However, my little MacGyver water collection and draining system prevented hundreds of gallons of water from filling the basement.
What Would MacGyver Do?
So what does this have to do with your business? Keep reading; there’s a message here. But first, let’s look at another example of MacGyver thinking in a business setting.
A toothpaste factory had a problem of sometimes shipping empty boxes without the tube inside. This was due to a minor timing deviation in the mechanical production line that couldn’t easily be controlled in a cost-effective way. Understanding how important it was not to frustrate customers, the company CEO finally decided to hire an engineering company to solve the empty box problem.
After six months and several hundred-thousand dollars, a solution was in place, on-time and under-budget. The problem was solved by using high-tech precision scales that would sound a bell and flash lights whenever a passing toothpaste box weighed less than it should. The production line would automatically stop while a worker walked over, removed the empty box, and pressed the conveyor restart button. Everyone thought the solution was fantastic.
One day, the CEO decided to look at the return on investment of his project. The results were amazing! No empty boxes ever shipped out of the factory after the scales were put in place. Customers were happy, and the problem was solved. “That was money well spent,” he said, before noticing the other statistics in the report.
To his surprise, the number of defects picked up by the scales after several months of production was zero. There should have been at least a dozen a day, he thought. Maybe there was something wrong with the report. After investigating, the report turned out to be correct. The scales really weren't picking up any defects because all boxes that got to that point in the line had toothpaste tubes in them. There were no empty boxes!
Puzzled, the CEO traveled to the factory and went to the production line where the precision scales were installed.
A few feet before the scale, there was a $20 desk fan blowing any empty boxes off of the conveyor belt and into a bin.
“Oh, that,” said a nearby worker, “one of the guys put it there because he was tired of walking to the scales every time the bell rang.”
Three Learned Principles
So, what can be learned from these two stories? Here are three takeaways you can apply to your business for better problem solving:
1. Apply Systems Thinking, a creative—MacGyver like—approach to business problems. (What would MacGyver do?)
2. Choose the simplest and least-expensive solution that gets the desired results (Ockham’s razor).
3. Go see the problem first-hand and get input from workers before undertaking any grandiose or expensive solution (Lean Thinking).
Now, put on your MacGyver hat and go save the day!
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Another new year has arrived, and it’s time to think about our business goals. But let’s do it a little differently this year, so that perhaps our noble effort will last beyond next week. Let’s create some BHAGs!
So what’s a BHAG you ask (pronounced BEE-hag)? It is a BIG HAIRY AUDACIOUS GOAL, a term discussed by Jim Collins and Jerry Porras in their book “Built to Last.”
A BHAG is a clear, compelling and overambitious goal that leads a company out of their comfort zone toward accomplishing the impossible. It unites the workforce behind a game-changing idea, worthy of their highest creativity and energy. BHAGs are often long-term and bigger, bolder and more powerful than typical goals. They require commitment, confidence, and even a bit of bravado.
The right BHAG is a lofty vision with a deadline. It will catapult your company to a new level.
Jay Arthur of “Lean Six-Sigma” provides an example.
”During the second world war, when cargo ships were at a premium, Liberty ships required almost 250 days to build. As the demand increased, the builders were asked to create ships much faster. Eventually they innovated the design and building of the ship and got the average to 40 days, about 20% of the time it took when they started. This wasn't because of learning gains; it was because the U.S. had a BHAG to build ships much faster. Setting the BHAG demanded that the shipbuilders think differently, organize differently and work differently. It also created a sense of urgency to know that their work was driving the war effort. If it can be done in shipbuilding, it can be done anywhere.”
How to Create a BHAG
The steps to craft an effective BHAG include:
- Conceptualize it – Involve key people. Make the goal tangible, innovative, compelling, and even fun. And be sure it’s AUDACIOUS (daring, bold, risky, and practically impossible)!
- Test it – Is the BHAG easy to understand, communicate, and remember? Will it stretch people to perform at their best? Is it measurable? Does it have a clear finish line? Is it life changing? Will the effort be worth it?
- Commit to it – Get everyone in your company behind the goal. Talk about it at your power meetings. Encourage thinking and working differently. Measure and report progress. Celebrate victories. Make it part of your business culture.
- Systemize it — Break the BHAG down into smaller chunks or mini-goals, and then incorporate them into specific and measurable systems (the Box Theory™ Way). Goals are only fantasy—wishful thinking—until you build them into a system, until the wheels of Cause and Effect start turning.
Incorporate the mini-BHAGs into your Balanced Scorecard objectives and key measures. For example, set big hairy audacious goals to increase sales per employee by 20% (productivity), reduce mistakes, defects and rework by 50% (quality), or improve on-time delivery to 99% (customer service). Reduce lead time (order-to-ship) to twenty-four hours, and so forth.
I am familiar with a builder who built a standard house in twenty-four hours. Now that’s a BHAG! It required different thinking and working. It was a marvel to watch. It shook the local building industry. It separated him from all other home builders.
Stop doing business as usual—like every other company—and “dare to be great.” Develop extraordinary goals supported by extraordinary business systems and processes. The most difficult step is the first one. Get going today. Demand immediate results. Stay the course. Seek continuous improvement. It takes time, but I promise, it will be worth it!
Now, what big ideas could you implement in the next three to six months that would elevate your company—that would expand or improve products, open new markets, provide “killer customer care”, or drastically reduce waste, inefficiency and cost?
As the saying goes, “GO BHAG OR GO HOME!”
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Did you realize when you got into business that your primary purpose is to be a “business engineer”—one who plans, constructs, and shrewdly manages an organization (online dictionary)? Your daily task is to develop people, products, and processes in an exceptional way to profitably find and serve customers.
Like fingerprints and snowflakes (below), there are no two businesses exactly alike. Each is a unique reflection of its owners and managers—YOU!
An engineer uses technical skills coupled with imagination and creativity to produce something of lasting value. Likewise, you are the mad genius who will create a business model that provides the products and services uniquely suited to your target market—a business so well executed that you can one day sell it for top dollar, replicate it in other markets, or have someone run it for you.
Your entire organization is made of interdependent systems and processes, each working together to accomplish your business objectives. In a typical day, you design, develop, oversee, monitor, and evaluate all the systems and processes that make your organization run smoothly, create value, and generate profit. Growing a good business is both an art and a science.
Art and Science
The art of business development is to create products and services that provide the best solution for your customers, and to develop an organization structure and culture that bring the best out of your people. You are constantly innovating to make people, products and processes better, faster, stronger, more efficient, of greater value, and more remarkable than ever before. While innovation can be a new invention, technology, or business concept, most often it will consist of incremental improvements at the detail level of your business systems and processes. It is this right-brain activity that gives your organization a different fingerprint than all others—what separates you from the crowd. In time, your business will become an inspired masterpiece!
The science of business development is the application of laws, principles and best practices to attain predictable and consistent results. It includes cause and effect, improvement methodologies such as Six Sigma, Lean Thinking and the Theory of Constraints, performance standards, measurement, and other means for achieving operational excellence. This discipline comes primarily from the left-brain and it is what your business has in common with other successful organizations—what enables you to efficiently produce quality products and services, and to generate profit.
Teamwork
Most people do not excel at both left-brain and right-brain activities. However, if you bring a good team of people—with a variety of skills and talents—into weekly power meetings, you will uncover the best innovations and solutions for your organization. (Consider this whiteboard method.)
Your goal is to attract and keep customers by creating a company that is brilliantly distinctive and operationally exceptional. Attention to your core business systems and processes can make that happen.
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As a small business matures, its systems and processes should also advance through several stages of improvement. Unfortunately, many small business owners do not understand this evolutionary process and get stuck at the lower "Neanderthal" levels.
In his book, Universal Principles of Design, author William Lidwell states that “In order for a [system] design to be successful, it must meet people’s basic needs before it can satisfy higher level needs.” (This concept comes from Maslow’s Hierarchy of Needs which describes human motivation.)
High-Performance Systems
Most entrepreneurs begin with basic functioning systems, often in the owner’s head. As the business expands, and people are added, systems need to become more formalized to keep up. Increasing growth, competition, customer expectations, and daily challenges demand that business systems reach ever higher levels of performance.
The Systems Thinker has an advantage. He or she understands the underlying principles of system development—process, components, people, quality, speed and measurement. When these fundamental principles are applied, high-performance systems and processes evolve naturally.
System Evolution
Let’s take a quick look at the five stages of system evolution beginning at the bottom of the pyramid—the lowest need. Think about one of your important systems.
- Functionality – Does your business system—lead generation, customer service, operations, and so forth, fulfill its basic purpose? Rudimentary systems at this level are a good start. However, they are subject to frequent change, errors, waste, frustration and breakdowns. They are nothing special, certainly no better than your competition.
- Reliability – Is the system performance stable and consistent? This is a big improvement. Your system is now smooth-running and predictable. It operates without a lot of supervision. You may even think it is good enough.
- Usability – Is the system user-friendly, easy to operate, and forgiving of errors? Now you’ve designed a system that people enjoy working in. You’ve removed complexity, confusion, uncertainty, and even employee murmuring. Your workers perform better when they enjoy their work environment.
- Proficiency – Does the system empower people to do things not previously possible? Congratulations! You have a high-performance system that delivers excellent quality and efficiency. It’s a money-maker. Your company is becoming exceptional!
- Innovation – Are your people now free to innovate and improve the system? Is the system team at the top of their game, continually trying to achieve higher results, and better their best? Does this happen even if you’re not around? When enough of your business systems reach this level of performance, you will have a culture of excellence!
System building is not an overnight task, but you can accelerate the process if you understand the principles that drive improvement. Invest a little time every day in The Zone and push your core business systems to the top of the pyramid.
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You can't turn on the news without hearing the word "system" thrown around, mostly related to the breakdown of systems in business and government.
Vehicles are being recalled due to faulty component parts. Massive oil spills damage the ecosystem. Terrorists get through airport security even when their name is on a no-fly list. Financial systems around the world are in crisis.
When will it ever end? . . . IT WON"T.
If left alone, systems are in a constant state of breaking down; they decline, decay, and deteriorate. It is Nature's way.
Natural forest fires rid the land of dead trees and wood on the forest floor. The heat of the fire immediately germinates buried seeds and soon a new forest begins to fill the land.
The cycle of life--birth to death--not only occurs in nature but there are similar patterns in business, including yours.
In the first few months of this year, sixty-eight banks have failed and many small businesses have closed their doors. As harsh as it sounds, this is a natural purging of the weakest elements of our economic system. Companies with inferior products, policies, systems, or management cannot withstand the financial stresses. Companies with better systems (or who get bailouts because they are "too big to fail") are able to weather the storms.
In tough times, only the fittest survive, those companies that daily work on building strong and durable business systems.
System Breakdowns Can Be Good
The upside of a system breakdown is that before the system fails completely, innovation can elevate it to a new and better way, a higher level of performance.
We expect to see future vehicles that are better, improved policies, technologies and systems that prevent oil disasters, terrorists that are unable to get on airplanes, and economic disasters that are averted. (This assumes that we learn from our mistakes--governments don't always seem to.)
In your business, customer complaints, low employee morale, poor cash flow, and so forth can always be traced to the breakdown of established systems.
A crisis, in fact, is a system change trying to take place. It is a scream for help. Reorganizing and reordering the system to a higher level is the only solution to prevent an eventual crash.
Caution: It is human nature when things are generally going well not to notice a breakdown that is occurring by small degrees.
Business systems that are continuously monitored, measured and improved break down much less often, and when they do, the cause is usually outside the business owner's control.
The System Thinker's Edge
Systems Thinkers have a distinct advantage. They understand how things work. They see problems in the early stages. They make timely course corrections. While they can't prevent every glitch, they can minimize the damage and overcome setbacks more effectively and faster than most everyone else.
Do you have any broken busines systems that are causing you to lose customers and money? Fix them while in the early stages, and save yourself a lot of grief later on!
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Yesterday I got a large mailer from a company called 3-Day Kitchen & Bath. The name of the company says it all. These folks promise—and deliver, I might add—a remarkable service in the eyes of their customers. As Seth Godin said, they "stand out like a purple cow in a field of brown cows."
From a System Thinker's point of view, all they did was change the ordinary kitchen remodeling process to an extraordinary new remodeling system—and then built an entire business around it. They achieved the kind of results we are all looking for.
- The offer is a powerful magnet to attract new customers.
- The service leaves customers delighted and amazed.
- Customers are eager to show their friends.
- The three-day job efficiency pushes costs down and profits up.
- The quick job cycle creates an abundant cash flow.
- The company owns its market niche.
3-Day Kitchen & Bath performs the same remodeling tasks as traditional construction companies. You may not be able to see a difference in the finished job; however, there is a huge difference in the way the work is accomplished!
The company pre-plans the job down to the last detail, and purchases all materials before construction begins. They have a specialized crew that can install cabinets, counter tops, flooring, appliances and so forth. They work extra hours on the three critical days. At the end of the third day, as the paint is drying, they pick up their check and say goodbye to their thrilled and grateful customers.
What Business System Can You Innovate?
3-Day Kitchen & Bath challenged the normal method of kitchen and bathroom remodeling. They asked, "How can we perform this service so fast that our customer's primary objections to remodeling—completion time, construction mess, and inconvenience—are totally eliminated. They figured out how to do the seemingly impossible, and turn it into a daily routine!
Increasing speed significantly beyond market norms is one secret to having a remarkable business system. One-Hour Photo did it. Federal Express did it. Twenty-five years ago, an enterprising group in our community decided to build a basic split-level home in twenty-four hours. I drove by and watched for a while. It was an incredible sight!
Years later, I suggested to one of my home-building customers that they should create a system for completing a standard home in thirty days from the time of customer purchase. They said it couldn't be done, and they continued to barely survive in a competitive market.
Ah, But It Could Be Done!
You have to think outside the box. You have to question norms. You sometimes have to do things that are hard to do. You have to change your core business system to something remarkable. You have to "dare to be great." When you do, you can gain the same benefits listed above. Review them again. Consider what system norm you could change to shake up your marketplace.
Remember: It's all in the SYSTEM!
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Fast Business Processes Increase Profit—7 Strategies To Boost Speed!
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