This Blog has moved!

I’ve integrated my blog into my new website. You’ll find it here.

The “Second” Set of Ten Commandments

Did you know there is a “second” set of Ten Commandments?

They offer very sound advice! The following is reprinted from Harvey Mackay, author and Chairman of Mackay Envelope Corporation.

We all know about the original Ten Commandments, but have you ever heard of the Second Ten Commandments? I don’t remember who sent them to me – these pearls of wisdom have been often attributed to one Elodie Armstrong – but I sure would like to thank him or her for sharing this wisdom.

Here they are with my spin on them:

1. Thou shall not worry, for worry is the most unproductive of all human activities. A day of worry is more exhausting than a day of work. People get so busy worrying about yesterday or tomorrow, they forget about today. And today is what you have to work with.

2. Thou shall not be fearful, for most of the things we fear never come to pass. Every crisis we face is multiplied when we act out of fear. When we fear something, we empower it. If we refuse to concede to our fear, there is nothing to fear.

3. Thou shall not cross bridges before you come to them, for no one yet has succeeded in accomplishing this. Tomorrow’s problems may not even be problems when tomorrow comes.

4. Thou shall face each problem as it comes. You can only handle one at a time anyway. In one of my favorite “Peanuts” comic strips, Linus says to Charlie Brown, “There is no problem so big it cannot be run away from.” I chuckle every time I think about it, because it sounds like such a simple solution. Problem-solving is not easy, so don’t make it harder than it is.

5. Thou shall not take problems to bed with you, for they make very poor bedfellows. If I wake up thinking of a problem, I tell myself it will seem lighter in the morning, and it always is.

6. Thou shall not borrow other people’s problems. They can better care for them than you can. I confess that I have broken this commandment because I wanted to help someone, without being asked, or I thought I was more equipped to handle a situation. But I wouldn’t have to deal with the consequences, either.

7. Thou shall not try to relive yesterday. For good or ill, it is forever gone. Concentrate on what is happening in your life and be happy now. We convince ourselves that life will be better after we get a better job, make more money, get married, have a baby, buy a bigger house and so on. Yet the accomplishment of any of those events may not make any difference at all. The Declaration of Independence says we are endowed “with certain unalienable rights that among these are life, liberty and the pursuit of happiness.” You are responsible for your own happiness.

8. Thou shall be a good listener, for only when you listen do you hear ideas different from your own. You can win more friends with your ears than with your mouth. Hearing is one of the body’s five senses, but listening is an art. Your success could hinge on whether you have mastered the skill of listening. Most people won’t listen to what you’re saying unless they already feel that you have listened to them. When we feel we are being listened to, it makes us feel as if we are being taken seriously and what we say really matters.

9. Thou shall not become bogged down by frustration, for 90 percent of it is rooted in self-pity and will only interfere with positive action. Seriously, has frustration ever improved a situation? Better to take a break, collect your thoughts, and redirect your attention to a positive first step. Then, go on from there.

10. Thou shall count thy blessings, never overlooking the small ones, for a lot of small blessings add up to a big one. We all have something to be grateful for, even on the worst days. Hey, you’re still on the green side of the grass, aren’t you?

Although Mackay’s “second” Ten Commandments aren’t chiseled in stone, try them! They’ll certainly make your life less rocky.

Outthink and Outperform Your Competitors: 5 Steps to Success

(This is part two of a two part post on How to Outthink and Outperform Your Competitors)

Here are the 5 steps that are required to create a comprehensive and practical plan for your business:

1.Identify your vision and clarify your values

Research shows that vision-driven leaders and their companies significantly outperform their competitors.  Your vision has 2 functions. First, it serves as a source of information, involvement, and motivation.  Second, it both informs and guides your decisions and the choices of your staff.  For example, I have a client whose vision is to “Automate, innovate, integrate, and simplify.”  After the management team communicated the vision clearly to the organization, it began to impact the myriad of day-to-day decisions and choices they and their people were making – moving them toward their objectives.
If vision is the “what” you are trying to achieve, then your values are “how” you expect your organization to behave along the way. 

They serve as guide posts for the members of your staff who, through their individual efforts, will collectively achieve your goals.  Values are the principles by which you do business and, once established, should be non-negotiable.  As you think about your values, consider what you know to be right, as well as how you want to be perceived by others. Values are demonstrated through behavior, and behavior creates lasting perceptions. Examples of core values are: trustworthy, we do what we say, fun, customers first, and respect for individuals.

Your vision and your values cannot be over communicated to your staff! In addition, they should directly influence your thinking in the 4 remaining steps of the planning process.

2. Assess external market and competitive conditions and trends

The first area to explore in the external assessment is customer segmentation.  That is, who your customers are now and who you want to have as your customers in the future.  Thee are many dimensions to consider here depending upon the nature of your business, for example, industry, revenue, and location for B-to-B, and income, home value, and number of children for B-to-C – just to name a few.  With deliberate focus onsegmentation and the needs and expectations of each segment, you will see opportunities more clearly.
Once you’ve clearly identified your customer segments, it is time to focus on your competition.  In doing this, there is value to looking at comparative strengths and weaknesses – both yours and theirs!  The ultimate objective is to find ways to leverage your key strengths against their weaknesses.  Although this exercise can be painful, understanding how you measure-up in terms of products, service, response time, sales skills, convenience, and value-added knowledge exposes opportunities and potential liabilities that your plan should address.

The final component of the external assessment is trend analysis.  Here you’ll be striving to understand the trends that are taking place – in your industry, among your customers, in our nation, around the world – that could have an impact on your business.  What is changing around you and how can you adapt?  You’ll pick this up in your trend analysis and it will help you minimize the impact of external events and capitalize on favorable developments.

3. Assess internal structure and resources

 Your organization must be structured to respond rapidly to the needs of your customers.  Sounds great, but is it? In evaluating your organization you may want to ask yourself some of these questions: Are we easy to do business with? Do we really add value, or just talk about it? How do we react when we make a mistake? The structure of your organization and the clarity of roles, responsibilities, and processes within it have a direct impact on your ability to provide value and positive, differentiated customer experiences.
 When you consider your available resources, don’t just think about people.  The resources at your disposal might also include real estate, equipment, growth capacity, service, technology, capital, intellectual capital, and expertise.  How you utilize them in aggregate is critical to understand, since business results are directly linked to your choices of how you acquire and deploy resources.  Understanding your market segments is another important dimension in the evaluation of your resources. Think back to customer segmentation and ask yourself: Do I have the right resources in place to meet my customers’ needs?  Are my sales producers and service staff sufficiently experienced in the segments we serve?

 4. Document Your SLOT (strengths, limitations, opportunities, threats)

Your external and internal appraisals identified concerns to be addressed and strengths upon which you can build.  The thinking you did about your competition, trends, organization structure, and resources highlighted areas that will have an impact on your ability to succeed in your chosen market segments.  Your SLOT analysis will help you summarize these issues and begin to conceive actionable ideas to maximize your strengths and opportunities, while minimizing your limitations and threats.
Strengths are defined as areas where your organization excels.  Limitations are usually weak points.  Opportunities represent significant and favorable situations in your markets that can help you be more successful.  Threats are like ticking time bombs that must be defused before they explode and do their damage.  While you may be tempted to focus on eliminating limitations, be sure to place an equal – if not greater – emphasis on exploiting your strengths.  This is how competitive advantages are built!

 5. Identify critical success factors (CSFs) and tactical goals

CSFs are the categories of things that must happen or must be in place for you to achieve your desired results.  Ask yourself: What broad elements are necessary and sufficient to achieve my overall objectives?  Some examples of CSFs are: Customer Service, Book Growth, Technology, Staff Development, New Market Penetration, and Sales Effectiveness.  Ideally, your business should have 4-7 critical goal categories to support your plan.
Your goals should be recorded in a spreadsheet, within CSF, including due dates, and – for each individual goal – the name of the person who will be held accountable to complete it.  The results of steps 1-4 can now be converted into specific, measurable, and attainable goals for your agency, forming the tactical road map – perfectly aligned with your strategic thinking – that will lead you to the results you seek.
As Confucius said, “A man who does not think and plan long ahead will find trouble right at his door.”  Centuries later, his wisdom still holds true – particularly for many companies in today’s waffling economy.  Whether you employ 6 or 600, a right-sized, well thought, appropriately executed plan will dramatically improve your competitive positioning and your performance regardless of market conditions.

Find a way to remove the obstacles that are preventing you from investing an appropriate amount of time in a disciplined thinking and planning process for your business. Your ability to outthink and outperform your competitors depends on it.

How to Stack the Deck in Favor of Making the Right Tough Decisions

 

Leaders are remembered for their best and worst judgment calls, especially when the stakes are high, information is limited and the correct call is far from obvious. In the face of ambiguity, uncertainty and conflicting demands, the quality of a leader’s judgment and decision making determines the entire organization’s fate.

 

That’s why leadership experts Noel M. Tichy and Warren G. Bennis claim judgment is the essence of leadership. In their popular book, Judgment: How Winning Leaders Make Great Calls (Portfolio, 2007), they write: “With good judgment, little else matters.  Without it, nothing else matters.”

 

But there’s no one-size-fits-all way to make a judgment call, the authors emphasize. Every organization has distinct problems, people and solutions.

 

A Framework for Judgment

 

A judgment call should not be viewed as a single-point-in-time event.

 

The process begins when leaders recognize the need for change and for a decision. They consequently frame and name the issue, set clear goals and objectives, align people and continue through successful execution.

 

Three Critical Judgment Domains

 

People: Leaders cannot set sound direction and strategy for their enterprises or deal with crises without smart judgment calls about the people on their teams. This is definitely the most complex domain. Sound judgments about people require leaders to:

1. Anticipate the need for key personnel changes
2. Specify leadership requirements with an eye toward the future – not the rearview mirror
3. Mobilize and align the social network to support the right call
4. Make the process transparent so it can be deemed fair
5. Make it happen
6. Provide continuous support to achieve success

 

Strategy: When the current strategic road fails to lead to success, the leader must find a new path. The quality and viability of a strategic judgment call is a function of:

 

1.      The leader’s ability to look over the horizon and frame the right question

2.      The people – both internal and external to the organization – with whom he/she chooses to interact

 

Crisis: During a crisis, leaders must have clear values and know their ultimate goals. A poorly handled crisis can lead to business failure.

 

The Process of Making Judgment Calls

 

In all three domains, good decision making always involves a process that starts with recognizing the need for the call, with steps that facilitate effective execution.

 

1. The Preparation Phase: This phase includes sensing and identifying the need for a judgment call, framing and naming the judgment call, and mobilizing and aligning the right people. While these steps may seem obvious, many factors can contribute to faulty framing and naming, which can result in a bad judgment call. For example, what is your process to separate symptoms from underlying causes? It’s important to allow “redo moments” and continually adjust to get it right.
2. The Call Phase (Making the Judgment Call): There’s a moment when leaders make the call, based on their views of the time horizon and the sufficiency of people’s input and involvement.
3. The Execution/Action Phase: Once a clear call is made, execution is a critical part of the process. Resources, people, capital, information and technology must be mobilized to make it happen. During this phase, feedback loops allow for adjustments.

 

Your Storyline and Why it Matters

 

Winning leaders are teachers, and they teach by telling stories. They develop a teachable point of view: valuable knowledge and experiences that convey ideas and values to energize others.

 

This teachable point of view is most valuable when it is woven into a storyline for the organization’s future success. As a living story, it helps the leader make the judgment call and makes the story become reality because it enlists and energizes others.

 

Winning story lines address three areas:

 

1. Where are we now?
2. Where are we going? (The inspirational storyline boosts the motivation for change and defines the goal)
3. How are we going to get there?

 

If judgment calls are difficult for you, or if you have difficulty creating the storyline for your organizational vision, it’s probably time to revisit these 3 key, strategic questions.

 

Who is Minding the Back Door for Your Business?

 

Most companies I know spend a large portion of their budgets on driving new business through the front door.  Far fewer spend even a fraction as much in a directed effort to avoid having those precious customers walk out the back door.  The prevailing assumption is that by providing pretty good service and having largely satisfied customers, the back door is covered as well as it can be, and everything else is controlled by external market forces.

 

In fact, retaining and developing profitable customers is the result of having a solid and aligned organizational culture focused on building relationships that generate loyalty.  According to Fred Reichheld, researcher, consultant, and author of The Ultimate Question, a loyal customer always returns, brags about your organization and provides (free!) word of mouth advertising.  They are willing to pay more to work with you and, when there is a mistake, they are more forgiving.  The ability to cultivate loyal customers is a profitable and powerful competitive advantage.

 

Satisfaction vs. Loyalty

 

There are 2 measurements that can help you understand and manage your customer relationships: customer satisfaction and customer loyalty. Many organizations assume that high levels of satisfaction translate into customer loyalty when, in fact, customer satisfaction ratings are more closely linked to your customers’ perception of product and service attributes rather than to the value they gain by doing business with you.

 

Satisfaction is a measurement of, “I expected it and I got it; therefore, I’m satisfied.”  If this were translated into a grading system, satisfaction translates into a grade of “C” on a traditional report card. This is precisely why your “satisfied” customers routinely shop around when it comes time to buy again. The desired score is obviously an “A,” an “A” always equates to loyal customers. An “A” implies that customers got more than they expected and their expectations were exceeded in some way.

 

High perceived value, as defined by your customers, creates loyal customer relationships, and research has demonstrated that customer loyalty is the best predictor of your future strength and growth potential. Perceived value occurs at the intersection of what customers want and what they get from you versus what they could get from your competition.

 

In order to create and sustain loyal customers, it is necessary to consider every contact with each customer as an opportunity for you to provide value—every time. Every service point is critical and every service point has a level of expectation from the customer that must be understood and managed. We call these contact points, Points of Connection (POC).

 

Points of Connection

 

Employee impact starts from the way they treat and relate to each customer at a given POC and their treatment of customers stems from the employees’ attitude. Attitude drives behavior, and behavior determines outcomes.  If the employees’ attitudes are positive, their behavior will be positive and supportive of the customer, which will generate results consistent with the expectations of the customer.

 

To effectively manage POCs they must first be identified. Once identified, you must clearly understand what value your customers’ desire from each POC. If there is a disconnect between what your customers expect and what currently exists then it imperative to ensure that proper employee development and process improvements are put into place to correct it.

 

Case Study

 

My friend, Jennifer Cassels, owner of Park Avenue Title Agency in Green Brook, NJ, exemplifies the cultivation of customer loyalty.  In the mortgage industry, the ability to overcome obstacles and close loans within tight timeframes can literally mean the difference between success and failure.  Jennifer works very closely with her clients – many of whom are real estate attorneys and mortgage lenders – to help them however she can to facilitate timely closings.  I’ve heard stories from her clients regarding her willingness to go “above and beyond” the call of duty to get transactions done – all the while providing accurate title services with a smile.  Additionally, she manages the POCs very well.  For example, you’ll always get a live person on the phone during business hours and she has a widely acclaimed closing cost estimate calculator on her website.  By managing POCs effectively and by going out of her way to solve her clients’ most pressing challenges (i.e. “how am I ever going to get this loan closed by Friday?”), Jennifer has created a loyal and growing client base.

 

Conclusion

 

Making the strategic decision to create a loyal customer base is one of the most important commitments you can make to the success of your business.  As Janelle Barlow and Paul Stewart say in their book, Branded Customer Service: The New Competitive Edge, “The customer service experience must be aligned with organizational promises.”  When your customer’s experience is not reflective of what has been advertised, promised, or expected, their trust in your business is undermined, which results in more traffic out the back door and lost revenue opportunities.

 

To build loyalty, your team must learn how to create strong relationships through frequent points of connection and deliver unique service experiences as expected and promised by your marketing and sales activities.  The immediate impact of delivering an exceptional experience based on what you’ve promised is a winning combination and a powerful weapon against the competition.  It will also help to ensure that the customers you work so hard to bring in the front door never even consider looking for the rear exit.