Posts Taged value

The One Year, Thirty Minute Challenge :: Week 47 :: Marketing :: Target Clients

Traditional marketing many times mimicked traditional product development. In traditional product development, a team of “experts” created a solution that – 1) they were enamored with, 2) represented a departure from current products in function, usability and/or experience, and 3) they hoped had commercial viability. Companies then turned those products over to traditional marketers who touted the features and benefits of the new offerings in hopes that someone would be willing to part with their hard-earned money and give it a try. In short, a solution in search of a problem. Once those few, brave early adopters surfaced, the marketers could look for others like them – target clients.

For decades, the bulk of “marketing science” was built around this approach. We learned about market segmentation, customer profiles, demographics, psychographics, geographics, behavioristics, and a host of other ways to segregate and talk to people who might be interested in our products or services. I’m not advocating that we abandon or unlearn all or even any of this, but instead broaden our field of knowledge. In recent years, new research in product development and marketing have the potential to make us much more effective in creating new offerings and communicating with those who are willing to buy them.

In Competing with Luck, Clayton Christensen helped us understand that the key to innovative product development is problem solving. Yogi Berra reminded us that, “you can observe a lot by watching.” Together, these two pieces of information give you everything you need to know to create a successful product. Carefully survey your slice of the world for a problem to solve. Then solve the problem better than anyone else.

Problems and the subsequent solutions can be simple – your smartphone slides across the dashboard or seat when you’re driving. You need a bracket that fits in your cupholder with a slot on the top to hold your phone. Or the problems can be more obscure – so obscure that you didn’t know you had the problem. Steve Jobs and the folks at Apple discovered that you needed a device bigger than your smartphone, but smaller than your laptop and viola, the iPad was born (along with a host of Android competitors). You didn’t know you needed a tablet, but, so far, about 1.5 billion of them have been sold worldwide. The potential upside of a product is in direct proportion to number of people that are afflicted by the problem that the product solves.

That brings us to this week’s One Year, Thirty Minute Challenge.

For this week’s exercise, I want you to create a detailed definition of the problem you’re effectively solving (what is the cause, how does it manifest itself i.e. what are the first, second and third order consequences, what is the personnel impact, what is the financial impact, what is the emotional or psychological impact, what is the social impact) and identify the people who have that problem – those people are your target clients.

As you start the exercise, the most disturbing discovery could be that you’ve created a solution for a non-existent problem (or a problem that afflicts a number of people so small, that it’s not commercially viable). If that’s the case, it’s time to survey the landscape and look for a problem to solve.

Assuming you have a superior solution to a real problem experienced by enough people, the assignment becomes, how do you effectively communicate with the people afflicted by that problem. I want to offer up some bullet points –

  • Discover where the people who have that problem look for information to solve it – Google search, friends on social media, LinkedIn, from others in their industry, cold sales calls, email solicitation, Yelp, Angie’s List, networking groups.
  • Begin interacting with them, using their preferred medium, with information that convinces them you understand the depth of the problem – discuss multiple manifestations of the problem and discuss the impacts of the problem.
  • Empathize with them. To prove the depth of your understanding, discuss the way the problem makes them feel – frustrated, insecure, uncertain about the future.
  • Start being useful. Offer initial solutions to the problem. If you give away valuable information you show your care for your target clients and your commitment to solving their problem. And you build credibility as a trusted resource.
  • Explain your value proposition – you have a good, workable solution that makes sense economically. You can’t charge them $10 to solve a $1 problem
  • Let existing clients build your credibility. Show that you’ve successfully solved the problem for others by sharing testimonials, case studies, and white papers.
  • Reach out to individual target clients with personalized emails (or for B2B, LinkedIn messages). Invite them into one-to-one conversations where you can probe for information on how the problem you solve impacts them.

As you explain your intimate understanding of the problem, your understanding of those afflicted by the problem, the pain they feel as a result, the epiphany that brought you to your solution to the problem, the thoroughness of the solution, the economic value of the solution, and the passion you bring to delivering the solution, you will gain recognition among those with the problem and will be seen as a valuable resource. You will find those who, as Simon Sinek would say, “share your why” or as Seth Godin would say, belong to your tribe.

In every interaction, probe for additional opportunities to listen and deepen your understanding of the problem and how it impacts potential target clients. And, in every interaction, if the target client is ready to buy, make your products or services available with an easy-to-follow call to action.

During this week’s thirty-minute exercise, gather your team together. After you’ve defined the problem in sufficient detail, make your initial pass through the list above. Make notes. Decide on your initial medium and messaging.

As you get started, resist the temptation to be perfect. Just start. Experiment with messaging and medium. Every time you get a response, increase your understanding of the problem and how it affects your target clients. Soon you’ll be effectively communicating with the people you’ve built your business to help.

The One Year, Thirty Minute Challenge :: Week 36 :: Technology :: Big Data

According to Statista, in 2010, the total of amount of data collected worldwide was 2 zettabytes – or to use a unit of measurement you might be more familiar with, that’s 2 trillion gigabytes. In 2024, that number is projected to hit 149 zettabytes. All that data isn’t kept, so IDC predicts that by 2025, the world’s accumulated datastore will be 175 zettabytes. According to Forbes, we (collectively) generate 1.7 megabytes of new data per person, per second. And here’s maybe the most interesting fact of all, according to IDC, less than 5% of that data will be analyzed.

So, why is any of that important in the world of the One Year, Thirty Minute Challenge? Companies who capitalize on the data available to their organization by –

  • Identifying what parts of that data directly impact their financial performance
  • Making meaning of that data with expert analysis
  • Turning that analysis into actionable insights
  • Changing organizational behavior based on those insights
  • Measuring the financial impact of those changes
  • Making additional changes based on those measurements

are seeing results. Here are a few examples from Tech Republic.

  • Supply chain safety and theft detection enables companies, with help of item-placed sensors and business intelligence, to reduce in-transit theft rates of supplies from 50% to 4% and to detect when the environmentals or seals on shipment containers have been compromised.
  • Logistics tracking and routing using business intelligence and machine-based data/sensors optimize delivery routes and driver habits creating fuel savings and better service.
  • Collections work at companies is avoided by learning more about customers who are behind on their payments through big data aggregation and business intelligence that can predict who in good faith can pay their debts with a little help–and then helping these customers keep their purchases and keeping companies from having to write off defaults.
  • Buying habits and preferences of consumers are better understood and lead to increased sales.
  • Predictive maintenance enables urban tram systems to stay online, reroute traffic where necessary, and flash adviser alerts to customers over their mobile phones while repair crews are dispatched to replace faulty components before the components actually fail.

Big Data doesn’t just refer to just the volume of data available today, it encompasses the “4 Vs” of Big Data –

  • Volume – Certainly volume is an important part of the equation. We have internal data from our CRM and ERP systems that tell us about vendor performance, product performance, customer behavior, employee performance and a host of other things. We have external data from social networks, online review sites and more. Because of the Internet of Things (IoT), we have data that originates not just from the actions of our employees or customers, but from inanimate devices connected to the internet. So, we can know the number of times a door opens and for who, the temperature inside a shipping container and when a client’s copier is low on toner.
  • Variety – This data comes at us in multiple ways. Structured data from internal systems where we’ve controlled what is collected and how and unstructured data from external sources. We might get a text from a customer with a video of the dishwasher we just fixed showing us that it’s still doing what it was doing before we “fixed” it, a Google review, a Twitter DM, a reading from a sensor on our delivery van alerting us to a tire pressure problem and the list goes on.
  • Velocity – If the previous two aren’t enough, maybe the most daunting is the speed at which it comes at us. Last minute’s data reporting that all is well, is superseded by this minute’s data reporting a problem on the factory floor or a customer unhappy with your product or service. Multiply those by the number of inputs (customers, employees, vendors, sensors) and it can seem overwhelming.
  • Value – In actuality, this is the one that matters most. Of all the data collected by your organization, what really impacts financial performance, customer experience and employee wellbeing (ability to do their job effectively and efficiently)?

One more thing before we jump into this week’s exercise. Big Data requires different skills and tools than the traditional reporting you’ve pulled from your internal systems. First, because of the mix of structured and unstructured data, you’ll need a data management infrastructure that can manage both. Second, you need someone who can help you navigate this new world. You can hire a data scientist or you might opt for outsourcing this part of your work to a vendor specializing in Big Data Analysis. The most rudimentary Big Data analyses are looking for trends (each month for the past six months, distributors of our product in the Southeast have reported a stock out. Each month, it’s been earlier in the month than the month before), patterns (customers whose first purchase from us is product X never make another purchase, but customers whose first purchase is product Y have an 80% chance of being a repeat customer), and correlations (in the Fall, the first time the temperature dips below 50 degrees canned soup sales double and stay at that level until the first time the temperature hits 60 degrees in the Spring). A Data Scientist can help you start thinking in this vein. Third, in addition to the infrastructure tools to do the heavy lifting, you need visualization tools that help you easily see what this large amount of data is telling you. Even if the data scientist tells you everything you need to know, you want to roll this information out to everyone in the organization who can benefit from it. Good visualization tools will allow them to consume large amounts of information (and make sense of it) more easily.

For this week’s exercise, I want you to identify some problems or opportunities in the organization where Big Data-generated insights might make a difference. Here are some thought starters –

  • More callbacks on service calls – Is it the same technician? Are they working on the same brand of equipment? Are replacement parts from the same vendor failing at a high rate?
  • Inventory management is more challenging than it should be – Can you get access into distributor data so you can see when distributors are most likely to place a reorder? Is a single vendor slowing production with late or defective products?
  • Customers seem uninterested in a new product or service – What is the factory defect rate on this product vs the defect rate on its predecessor? Have customers who purchased the product commented on social media regarding the product? Is it especially unpopular among your customers who purchase another product from you?
  • We have too many employees during some shifts and not enough during others – Can you examine sales by hour for the same day of the week last week or the same week last year? Can you examine the nature of sales during each shift – selling a hand-dipped ice cream cone is more labor intensive than selling a bottled soft drink?

Take your list and contact a Big Data company for a consultation. See if it makes sense to do a pilot project.

Big Data is the foundation for technologies like Machine Learning – the improvement of computer algorithms through experience (people who bought this book also bought this book, powering your Amazon recommendations) and Artificial Intelligence – when a system “perceives its environment and takes actions that maximize its chance of successfully achieving its goals” (think Big Blue playing chess against a Grand Master, examining the chess board and making the optimal chess move).

Of all the technology assets in your company, data is the most important. It catalogs the past behavior of your employees and customers. And the best predictor of future behavior is past behavior. Don’t neglect the power of this asset to solve problems that have puzzled you for a long time.

Depreciating Employees

Sorry to bring this up, but in just a couple of months it will be tax time. Very soon the Finance folks will be talking with us about deductions, assets, 1099s and more. One of the conversations will likely involve depreciation. Depreciation is the mechanism that allows us to account for the portion of an item’s value we’ve used to create products or services in that year. It’s fairly intuitive – the truck we purchased in 2014 delivered products, picked up materials or made service calls – all allowing us to serve customers and make money. At the same time, the truck is another year older – more wear and tear, more maintenance required and certainly worth less than when we bought it. Even with top-notch maintenance and lots of replacement parts, we’ll not return its value to the original purchase price.

This type of depreciation is unavoidable and, in reality, desirable since it enables our mission and money-making. But there is another type of depreciation that’s damaging and unnecessary. Can employees depreciate? Think about it. You’re most likely handing out raises with those year-end performance reviews. Certainly your benefit costs are going up. So, if you get the same amount of value from those employees this year that you received from them last year, but you’re paying more for them, they are depreciating.

Let me hasten to say, I realize they’re another year smarter with greater experience.  That should allow them to successfully ride the experience curve and add more value to your organization. But what if you could supercharge their growth? Unfortunately, I spent a good portion of my former corporate life focused on projects and processes and not on people. It never dawned on me that I was contributing to employee depreciation, since I was giving more of the company’s money (through yearly raises and benefits) to employees whose development was primarily just what they caught by osmosis over the course of the year.

Fortunately, since my switch to consulting and through my own personal and professional growth, I’ve had the privilege of helping clients create and implement robust employee development plans; plans that make people smarter, give them vital experiences that prepare them for new responsibilities in the organization and equip them with new tools that bring them personal satisfaction and allow them to better meet the needs of the organization’s customers.

It’s just the opposite of employee depreciation. It’s employee appreciation. Each passing month, the value of the employee’s new knowledge, skills, abilities and experiences far surpass the increased compensation. This makes for an organization that’s growing, transforming and competing because its team members are growing and transforming.

To download the initial Employee Development Plan Worksheet that my clients use to start the Employee Development conversation with their employees, click here.