Archives for category: Strategy

I took a leaf out of explorer Ernest Shackleton’s recruitment-writing book the other day. You may recall the famous – and almost certainly mythical – job ad from a century ago:

MEN WANTED

for hazardous journey, small wages, bitter cold, long months of complete darkness, constant danger, safe return doubtful, honour and recognition in case of success.

Simon Sinek used it as the perfect example in ‘Start With Why’ of how to get people with similar values to yours to follow you for the right reasons.

How does the Endurance expedition from the 20th century connect with my project in 2019? Well, I’ve written a book and I’ve sourced the imagery. It’s not a long book to read, but it is a book of many pages. You might say it’s a coffee table book. I know how I want the book to look. I need a designer to take on the ‘arduous’ task of designing and laying out the words and pictures of a publication which will stand or fall by how it looks. It’s not an easy task and I haven’t much money to bargain with. What I’m hoping for is to spark the interest of someone else who shares my desire to see other people succeed, since that’s what the book – and a lot of what I do in my job – is about.

I can’t offer them a job, but I do need a job doing, if you see the distinction. Hopefully they do too.

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A while back I wrote a post called Are You Working In or Working On? Working in the business is a ‘head down, bottom up’ thing where you’re getting stuck into the everyday tactical stuff. Working on the business is the strategic, directional side of it.

I want to tweak that question slightly in this post, to this: are you working on something, or towards something? This to me is a pretty fundamental question. There’s no right or wrong answer. In fact, I think you have to do both.

Working on something means you’re in the moment, dealing with the present tense, getting it done. Working towards something means you’ve an eye to the future, or to a destination. It’s like the difference between the journey and destination. A means in itself, or a means to an end.

If we don’t know where we’re going with something it’s hard to shape what we’re doing right now. Conversely, if we don’t know where we’re going with something we can learn from the journey. After all, we can’t necessarily see the finish line but we can see the next few hundred yards and that’s enough to keep us on track.

Keeping an eye on what we’re working on sets us up for what we’re working towards. Keeping the other eye on what we’re working towards improves the quality of what we’re working on. Sounds like a pretty virtuous circle to me.

 

A picture tells a thousand words, as the well-worn phrase goes. Most of us would find it very easy to use up a thousand words describing a painting, picture or diagram, and a good picture kind of does all the work for us. People find it much easier to retain something visual, so as sales people, marketers and storytellers we rely on a picture to bring people along. I tend not to do it so much myself, but a lot of people at work tend to want to whiteboard what they’re explaining.

I’m a words guy rather than a picture guy, but that’s not to say I don’t appreciate a good picture. A good picture is simple, powerful and influential. Pulling against this force is the desire to put everything in, include all the thousand words so that nothing gets left out, or left to chance in the mind of the person we’re trying to communicate with. When we do this we risk the simple message being lost, so we’re back to square one.

Of course, this hasn’t stopped me trying, at every business I’ve been involved with, to draw picture of everything that goes on in the organisation, so we can show how it all fits togethers, all the elements and interdependencies. Every time it gets too complicated, too difficult, and I run out of space.

The other day I mapped all the sales, marketing and service functions for your typical organisation serving a customer through their entire lifecycle, from not-yet-a-prospect through to an active advocate customer. It came out as a multi-ringed circle diagram, and I quite like it. I might have cracked it. It helps me help companies see where the gaps are in their coverage and strategy, where the holes are in their 360-degree view of their customers. Of course, it’s not exhaustive, you’d probably need ten thousand words for that, and there’s not a powerpoint slide, poster or whiteboard that could do justice to that level of detail.

You have to stop somewhere, and I have. It’s my new shiny ten thousand word picture. Now I need to test on my market and see if they get the big picture.

Funnel and Hubspot Flywheen

Funnel and Hubspot Flywheel

For decades we’ve been talking about funnels – or hoppers – to talk about how we manage sales, especially in B2B circles. Marketing throws leads into the top of the funnel, perhaps helps leads advance down the funnel, and sales pushes them down through the bottom until they emerge out of the funnel as a customer, a sale. It’s also assumed that the funnel has holes in the sides, since leads and opportunities get qualified out or are lost during their journey, but that’s not really talked about and not what I’m talking about either.

Then there’s the flywheel. The flywheel analogy and image is a Hubspot creation, – at least I think they originated it – and aims to better integrate the customer, ideally the delighted customer, into the selling process from an advocacy point of view. After all, with the funnel, once the opportunity emerges as a customer there’s not a natural way for it to come back into the funnel as a repeat customer or as an influencer to a new customer.

I like the flywheel approach, although I prefer a wheel analogy myself, and I can see where they’re going with the idea that a flywheel increases in speed due to the rotational energy of delighted customers feeding fuel to the marketing and sales engine.

Hubspot acknowledges that you still need funnels in a business that measures its success, and argues that you can put funnels within the various stages of the flywheel. That doesn’t seem particularly elegant and they don’t even try to present it visually. But, viewing your customer’s buying journey as a circle rather than a straight line certainly helps you keep your focus on developing your existing business and leveraging customers to bring in new business.

I was researching a certain industry vertical the other day. I was trying to decide if I should start learning more about it, becoming more knowledgeable, and acquiring some domain knowledge so that I could target it and sell to it. There’s a lot of it where I live.

So I went onto the web to get the skinny on the sector. What’s it really like? What makes it tick? How does it really work? What are the drivers, the things that affect its shape, size and speed?

I couldn’t find anything useful on the web. Nothing that gives you the inside track on the sector. Not even wikipedia. Not necessarily how big the sector is and how many players are in it, but how does it really work? What’s it all about? Is it worth getting into?

I wondered why it’s so hard to find a couple hundred words that give you a steer on a sector you don’t know much about. Not an introduction to the industry that is a book in its own right, but something enlightening – a blog post perhaps – that takes 5 minutes to absorb. Is it too hard to do? Has no-one thought of it before? Can no-one be bothered to write it and make it easy to find?

In the end, I went the old fashioned route and asked someone from the sector to have a coffee with me, which will take a couple of weeks to schedule. If only I could have found the answer in a couple of minutes.

 

 

 

A good while ago I wrote about how strategy and execution are joined at the hip, but that one tends to attract a higher consulting rate than the other. It’s hard to have one without the other. If you have little or no strategy and you execute like mad, you will have some success, but not as much as you might have hoped. If you don’t execute on a good strategy, you don’t really have anything.

I was reminded of this in a recent post by Tom Tunguz on the importance of execution. He referred to an HBR article from over three decades ago about ‘hustle’ – or the concept of getting it done – as the strategy. The central premise was – and still is – that it’s really hard to get competitive advantage, let alone sustain it, so you’re better off executing your plan better than everyone else.

I think a lot of people who work in areas where it’s hard to genuinely differentiate will identify with this approach. You still need to plan well, hire well and measure well, however.

Execution is what separates the men from the boys, the women from the girls, and the growing companies from the struggling companies. It’s about following through, staying the course and closing the loop. You need to just do it, repeatedly.

I was back in the UK recently, where the mood was somewhat Brexit-fixated, as could be understood for the single greatest economic event in our lifetimes. There is a feeling of uncomfortable change and uncertainty.

Unfortunately, I was accompanying my mother to a funeral. It was a slightly convoluted travel arrangement, as the funeral was 2 hours away. My brother would drive us up there to attend with us, before heading somewhere else for work. We would take the train back. Mum wanted to avoid the Friday afternoon motorway traffic. So, it was two singles from Stafford to Bristol, about a 2-hour journey on the Crosscountry Trains service.

Mum insisted on paying for my ticket, a ludicrously expensive £60 for a single off-peak journey. The train was 10 minutes late picking us up. There were no seats available, the train was only 4 carriages long, an intercity train service running at 6pm on a Friday, what I would call peak travel time. I managed to find one seat for Mum and stood in the aisle. Two minutes later the food trolley wanted to come through – well, not the food trolley, a chirpy soul directing the food trolley. I had to walk the length of the carriage to let him past, and then come back again. I offered to lie on the luggage rack instead, but he said that would be too dangerous.

After 20 minutes, some seats freed up, so we were able to sit together for the rest of the journey. The train arrived, twenty minutes late. I’ve written before about how the UK rail system is so complex that it seems impossible to keep the trains on time, yet the Germans and Japanese manage it. Nobody seemed all that bothered by the crushed train and its lack of punctuality. Par for the course, they would probably say.

It has been a while since I took the train. No feeling of change and uncertainty there. Same as it ever was.

I’ve spent the last 14 months or so working in the food sector. Not exclusively, but a few days a month, enough for it to form a sizeable chunk of my workload and recent experiences.

So here’s what I’ve learned about food. Not food itself – after all I’ve been a consumer of it for the wrong side of half a century – but the food business. I’ve listed 6 things I think are important, at least for new or small players in the industry. The FMCG business is a whole different ball of wax, I imagine

  1. Location, location, location. Not where your store is, we all know that one, but where in the store your product resides. The easier it is to spot or find, the more you’ll sell. You need to bolster a poor location with something eye-catching if possible
  2. Taste. Taste is the number 1 driver for consumers. If the food doesn’t taste good, it’s really hard to shift. Even superfoods struggle to move if they taste less than appealing
  3. COGS. Control over your Cost of Goods Sold – or COGS  for short – gives you options. The lower your COGS, the greater your gross margin. If you can’t lower your COGS any further, your back’s against the wall
  4. Distribution. Distribution is key. You need to get your product onto shelves, but then you’ve got to get it off the shelves and into shopping bags. A good distribution partner is a key element of this, and the key to scaling. A bad one will just wait for the orders to come in, leaving you to work hard with the retailer while all the time giving your wholesaler margin that haven’t really earned. The more the players in the distribution chain, the more margin you have to give away, which feeds into point 3
  5. Badges. You need the badges for premium products. The organic, sustainable and vegan check marks and accolades are important credibility nudges, and prestigious awards help a lot too
  6. Graft. It’s a lot of graft building and sustaining a product line. Almost everyone, especially lean model companies, has to do the graft and sell it themselves to start

Chains are an interesting way of explaining business or biological processes that connect players in a particular ecosystem.

The supply chain and value chain are handy ways to explain what happens either side of the manufacturing and creative process. The food chain is not so much a chain as a loop from contributors to consumers who in turn become contributors to start the cycle again.

The use chain – I don’t know if that exists as a term, but if it doesn’t I’m coining it now – is an interesting one. At some point somebody acquires something, uses it and passes it onto someone else to use, or else re-uses it themselves – re-consumes it if you like. The product or service doesn’t change materially between one user and the next, or one use and the next. There is no additional value or additional commercial benefit built in to the second or more use. Re-using something is the enemy of commerce, but friend to the consumer and the environment. In a responsible and societally aware culture, if we can’t re-use something then we can recycle it, or reduce it to minimise the impact of its having ceased to be useful or consumable to us.

If we could figure out a way of enabling a win-win for the use chain, the planet might have half a chance.

Partnerships, relationships, company. All of a sudden it’s not about what you want, or what your company wants. It’s not even about your end customer. It’s about the person that holds the key to the end customer.

With partners you’ve got somebody else’s priorities to think about it. This is why people that consult on partnerships emphasise the importance of lock-step, being aligned with your partners and making sure their goals are your goals.

You work really hard to get a partner on board, an agent, a distributor, a reseller perhaps, and then the hard work really starts. That’s when you figure out how important to them you really are. If they’re calling you, they’re getting pull from their customers, what you have is easy for them to sell, and profitable too. If they’re not calling you, their priorities are not yours and they’re not going to bat for you. Simple as that.

It’s a bit like the domino theory I proposed in blog post number 1. You’re facing your partner, looking for their attention, but they’re facing their customer, looking for their attention. An entire supply chain can be like that, a line of dominos focused on their customer and ignoring their supplier.

Bottom line? Well, 3 bottom lines, I think. Your product has to be relatively easy for someone not in your company to sell, which you can help with, of course. Second, it has to have sufficient margin for it to be worth it to your partner, who will always seek the path of least resistance toward hitting their own target. Third, the end customer has got to want it, to pull it through the supply chain. How you achieve that pull? Well, that’s all down to you, your marketing, your budget, your staying power and your inventiveness.