Isn’t it infuriating when things you come to rely on to work perfectly – even (or perhaps especially) when you only use them occasionally – suddenly don’t? I had one of those experiences with my (fairly new) shredder recently. It worked perfectly last time I used it. This time – no sign of life whatsoever. With anything electrical, there are a few things I always try first. A different socket? Nothing. Change the fuse in the plug? Still nothing. See if it’s just having an off day and will feel better tomorrow? No different next day. Painstakingly fish out from between the sharp blades as much of the old shreddings as I can, in case it’s just a jam? No good. At that point I hunted around until I found the user instructions. They didn’t seem to have a trouble-shooting section. Perhaps it was time to look at the guarantee, so I went to the website looking for details. Nothing much helped, but I did find a ‘contact us’ button, so as it was a weekend I wrote an email explaining the situation. Much to my surprise, I got a phone call on the Monday morning from a lady saying she was from Fellowes and she believed I had a problem with my shredder? She took me through a fault-diagnosis process, tailored to my shredder model, and including the sorts of things users do uninstructed (like putting a plastic bag in the bin to collect shreddings). In less than five minutes the problem was solved.
Great customer serviceWhat a great customer service experience! I finished up being a very satisfied customer with a working shredder. It felt a more positive experience than I would have had if I had identified the problem myself from the instructions. There were minimal delays and no one had any costs of shipping the unit anywhere. The cost to the company must have been minimal. In fact it was a very economical bit of promotion. Providing written fault-finding might seem the obvious thing to do. In fact, even if it had worked it would have been a missed opportunity. It pays to think beyond the obvious! This article was first published at www.otteryconsulting.co.uk.
As an interim manager, I rely on networks to find my next assignment. Many of the people in my immediate network I have known for years, but I still make sure I keep in touch. It only needs the occasional coffee, phone call or email. With newer contacts that I know less well, I make more effort to build the relationship. Most of those people will never give me any work. It is not that they don’t want to, but possible assignments depend on relevant needs coming up. From a hard-nosed point of view, as an investment perhaps my effort is not worth it. But I keep in touch because I want to maintain the relationships, not because they might lead to work. I believe that the willingness to meet would soon dry up if people felt I was only there to sell. I spend quite a lot of my free time supporting my University’s alumni relations. We all know that in the end there is only one reason why universities have become so keen on keeping in touch with alumni recently. They want our money. However, donations do not just happen. Unless there is an overt exchange (e.g. we will name xxx after you in return), persuading people to give depends on the relationship you have with them. And relationships are really between people, not between people and organisations. I build relationships with fellow alumni through activities we share only because I – and they – value the relationships themselves. If that builds engagement with the University and leads to giving, that’s good, but it is never the point. Indeed, raising the subject of fundraising at all would put some people off engaging, so it is off-limits.
Relationship building sows seedsThe point of relationship building and maintaining networks is to create a fertile seed-bed for what you hope will germinate in the future. The gardener can dig the soil, add compost, and provide water. He can provide the conditions for successful germination. The miracle of germination though comes from the seeds themselves.
I’ve just started trying to organise a local walking group for alumni from my university. The initial process was simple: I wrote an email asking for interest, the alumni office sent it out to people on their database with postcodes in the local area, and I collected the responses. The outcome has been pleasantly surprising. The response rate was over 10%, which under almost any circumstances I would think was a fantastic return for a single ‘cold call’ message out of the blue. But almost as surprising was the proportion of responses which included words along the lines of ‘what a good idea’ with at least the implication of ‘why has no-one suggested this before?’. It seemed as if all that latent demand was just sitting there waiting to be tapped.
InnovationThat set me thinking about how innovation happens. This was not a complicated idea; anyone could have tried it. But no one else did. So what does innovation need? I think there are usually two ingredients. The first is some kind of investment. Often that is financial, but (as in this case) it may just be time and emotional energy. Investment means that you have to put something in, but that success is uncertain and although you may be rewarded well, you may also get nothing back. So the innovator must be willing to take that risk. The second is some relevant knowledge. I had done something similar before, so I knew an easy way to reach my target audience. That knowledge reduced both my investment of time and the risk of failure I saw. I might have been willing to try anyway, but this made it more likely that I would. Certainly I was more likely to try than people without that knowledge. All of us prioritise what we will spend our time on, largely based on our perception of the risk-reward balances of our options. Making innovation happen is usually not about brilliant ideas; it is far more about simply taking the risk to put a simple idea into practice. There is little you can do to change someone’s appetite for risk. If you want to encourage innovation, then, try to find ways to reduce the risk that they see.
Many years ago I used to make pottery as a hobby. After a few years I got to be good enough that friends sometimes asked me to make pots for them. Of course, that is when things start to get a bit difficult – what to charge them? I could have said “I’m a hobby potter – if I cover my costs, that will be fine.” But then, if a friend asked me to make something (in principle at least) it was instead of buying from someone who was trying (and mostly struggling) to make a living out of potting. For someone like me to undercut them seemed wrong. I always charged about what I thought they would have had to pay a ‘real’ potter for something similar. That way I felt that they were choosing my work just because they liked what I made. When I explained, everyone thought that was fair. Over the years, I have learnt just how important it is to value yourself appropriately. I once took a job at a rather lower salary than I had been used to, rather than continue the uncertainty of searching until I found a better one. I discovered that because I had accepted that valuation of myself, understandably everyone else did too. The job didn’t challenge me, so I got bored, but it seemed to be impossible to persuade anyone within the organisation that I could be adding more value if only they would ask me to work on some more difficult problems – of which there were plenty. The job I was doing needed to be done. Before long, I left to go to a job at a more appropriate level. This can be a difficult balance for an interim manager. Price is only an imperfect proxy for the value of the job, but what a customer expects to pay is usually a good indication of how they see it. We all need to pay the bills, but accepting a disparity in price perceptions is not usually a good basis for a satisfying relationship in any kind of transaction.
As a consultant, I have many discussions with people who might be future clients. I never quite know at the start of the conversation where it will go – I’m there to listen for the opportunity, to understand what the client needs (perhaps before they do), and to help them to decide whether I might be an effective part of the answer, whatever it might be. Until they explain their situation, I can’t tell where we may finish up. Even so, I was taken aback recently when I was told quite out of the blue at the start of a client meeting that I thought was going to be the usual consultant’s exploratory discussion, that it was effectively an interview for a senior role in their team (I’ll talk about miscommunications another time!). My immediate reaction was to express my surprise at this turn of events, while inwardly panicking slightly and trying to think very fast about what this role would involve, what experience I would therefore need to tell them about, and whether I even thought I could do it. Afterwards I realised that although I had gone into the meeting with my flexible ‘I’m a consultant, just tell me what the problem is’ hat on, the hat was not that flexible. It took me a few minutes to adjust to the new situation, and to feel comfortable again. We all put ourselves in boxes – even ones with somewhat flexible walls, or room to rattle about in – all the time. The walls of the boxes are safe and comforting. Outside the walls lies danger (at least that’s how it feels) – but also opportunity. How hard it is to allow ourselves to be born into that new world of wider opportunity – but like birth, how essential it is if we are to grow!
Coming home from work the other day I saw a poster on the Tube which grabbed my attention. Leaving out the unnecessary details, it said “Buy a ……, get a free …… worth £49!” Is it really? Value, like beauty, is in the eye of the beholder. The company may choose to sell the gadget for £49 normally, but that certainly does not mean it is worth £49 to me. In fact, it almost certainly isn’t – it might be worth more, in which case even if I had to pay for it I would think I was getting a good deal (and I may well have already bought one anyway), or it is worth less, in which case I’d never buy one normally, but might be tempted to get one for nothing. It is pretty unlikely that they have hit on exactly the right value for me. Our entire economic system is based on the idea that things have different values to different people. That is how trade works – if it were not like that, it would be impossible to make a profit on trading, so there would be no incentive to do so. I buy something because it is worth more to me to have the thing than the money. The seller sells it because they value having the money more than the thing. It may be in the trader’s interests to confuse value with price, but in the end we all make our own judgements about what something is worth to us. [contact-form][contact-field label='Name' type='name' required='1'/][contact-field label='Email' type='email' required='1'/][contact-field label='Website' type='url'/][contact-field label='Comment' type='textarea' required='1'/][/contact-form]
What do you think when someone offers you something for nothing? I suspect most of us say thank you very much, put it in our pocket or bag … and then often forget about it. The problem is, when we give nothing for it, we tend not to value what we received. Many years ago I was involved with promoting amateur music events. Sometimes there were few costs to cover, and the main aim was to attract a reasonable audience, so an easy option was to make admission to a concert free. What happens if you do that? You often get a smaller audience than if you sell tickets at a low price! Why should that be? Well, put yourself in the shoes of the punter. You see a poster advertising a free concert, which looks interesting, so you make a mental note. Come the day of the concert, chances are you have either forgotten about it, or something else more attractive has come along. Since you have invested nothing, you choose to do the more attractive option. Because the organisers have not made you put a value on the event, you may treat it as being worth nothing, unless something else gives it value for you (for example you know one of the performers). There is little difference between something for nothing and nothing for nothing. On the other hand, if you have to buy a ticket, even for a nominal sum, you must give the event a positive value. In addition, if you have to buy the ticket beforehand, you have made an emotional investment. You are more likely to remember about it, and less likely to decide to do something else. Luxury brands do something similar but in reverse. The product itself may not be objectively any better than something cheaper, but the value people put on it is higher, so they are willing to pay more. Value has a significant emotional component, so pricing is always partly a decision about emotion. Never undervalue that!
I have recently moved house. I moved from a small and very ordinary town in Oxfordshire to a bustling area of London. What a contrast! From largely white to multi-cultural, from sleepy to vibrant, from staid dormitory to entrepreneurial. One of the big differences is shopping. In Oxfordshire, there was little choice but to buy all your groceries from one of the big supermarkets. When I first lived there, there were many butchers, greengrocers and bakers. Over the years they have all shut up shop, unable to compete with the demand for the convenience of "all I need under one roof" and "open when I get home from work", even if supermarket prices can be high. Here I am spoilt for choice, especially with butchers, fishmongers and greengrocers. What a delight to be able to wander up and down the stalls, with the noise of vendors shouting out offers, with the bright colours of peppers, tomatoes, oranges and lemons and the indefinable smells, looking for the freshest, the fattest, and (wishfully) the tastiest.
The right priceOne thing though took me by surprise. The price of bananas. Most of the market fruit and vegetables are good value by comparison with the supermarkets. But bananas? I’d guess the market price is about double the price in supermarkets! What is the right price? What is going on? The big chains compete with each other, not with market traders. If one shop puts a price down, the others pretty much follow suit. If one decides that bananas are to be a loss-leader, probably the rest do too. And this sort of pricing is like a ratchet – if it becomes established, it is very hard to move it in the other direction. The supermarkets may paint themselves into a corner. Pricing matters – and not just because companies exist to make a profit. Price sends a signal about what something is worth. “You get what you pay for” as the saying goes. Paradoxically, you may get more people coming to an event for which they have to buy a ticket than will come to one that is free, because the free event is not valued. Needing an income, I once took a job which paid considerably less than I had previously been earning. Result? I got very bored because no-one thought to use my higher skills. I was pigeon-holed by my price, and I left as soon as I could. Pricing that does not match value may serve a necessary short term purpose, but in the end it serves no-one very well. The right price matters.
Oxford is a city that is full of tourists, and in the UK where there are tourists, there are brown signs to direct them to the attractions. As well as the name of the attraction, a sign often also has what might best be called (by analogy with IT) an icon. The sign in the picture shows the word ‘Sheldonian' and a mask – the icon for a theatre. As you might guess, it directs you to the Sheldonian Theatre. So far so good. There is just one problem. The theatre in question is not a place where you go to see plays. It is in fact the main ceremonial building of the university, where amongst other things, students are admitted, and all being well, later receive their degrees. I don’t suppose it confuses proud parents attending the ceremony, but I wonder what less well-informed tourists make of it?
Poor brandingI won’t speculate on whether the person who designed the sign realised what they were doing, but it reminded me of an important business truth. Broadly interpreted, what happened here was poor branding – the icon was inconsistent with the meaning, potentially leading to confusion and frustration. The importance of consistency and integrity of messages is universal, whether or not the messages we are giving would conventionally be thought of as branding. When everything we see and hear is consistent, we believe in the authenticity of the message, and that builds trust, be it in a product, an organisation, a person, or a set of signs. When we realise that that consistency is lacking, trust is lost - even if only in the brown signs. Any time you want to build trust, think of yourself as managing your own brand. As change managers, the ability to build trust is one of our most important skills – so we can't afford poor branding. Whatever and however you are communicating (particularly when you are not deliberately communicating at all!), be authentic – then you will also have that essential consistency. Perhaps it does not matter if one set of signs has an odd choice of image, or just how much the signs are trusted. But how many times have you made similar mistakes, which may have had worse consequences?
Review of 11 Rules for Creating Value in the Social Era by Nilofer Merchant Perhaps surprisingly, given the title, Nilofer Merchant’s short book is not so much about the ‘how’ of social media, as the paradigm shift it has enabled in the way that most of the world does business. In the old days, ‘efficiency’ – doing things right – ruled. You made more money by having more efficient processes, and by having the scale to cover your high fixed costs easily. Large dominant players with efficient processes made it almost impossible for small companies to overcome the barriers to entry. In the past those approaches may also have been ‘effective’ – doing the right things – but the context has changed. In the new world, while scale and efficiency can be good strategies where there are low levels of innovation and change, the inherently cautious response of big, efficient organisations becomes a disadvantage: the ‘right things’ change too fast. High rates of innovation and change have become possible through the power of social media. Merchant says that a new approach is needed, based on embracing what social media enables, characterised by
- Community: A far more flexible way of allocating work;
- Creativity: Allowing co-creation of value with customers;
- Connections: A more open approach than in the past to customer relationships.