Lesson Learned #9
One of our clients was the chief operating officer of a large international container shipping company. He made a name for himself for taking over newly acquired companies and making them more successful, no small feat when you consider how common it is for acquisitions to fail. One of our partners worked with him over a number of years and was fascinated by what appeared to be a formula for his success. So he asked the client if he in fact had a methodology. The client told him fairly matter of fact, “Yes. We call it ‘product innovation’. You have to improve the product in a meaningful way. ”
The reason, he explained was that by focusing on the product it forced him to really understand what customers wanted most, how well the company delivered those things, and how the company differentiated itself from competitors. If they could figure out how to tweak the product (or in this case service) and make it better it had a number of key benefits:
- It gave the company’s sales force new inspiration and a reason to sell. It also gave customers and prospects a reason to take a sales meeting.
- It gave the company a fresh platform to market their service offering.
- It also provided a reason to market internally to energize the employees.
He hired us a few times to speak to his customers and to compare his company’s performance against competitors on key attributes that influenced the customer’s buying decision, as well as determine how easy or difficult it would be for customers to switch suppliers. From this information he would examine which attributes were important but not “owned” by any single competitor. He’d then see if they could modify their service to capture and own that particular attribute, and then build the company’s delivery and marketing around it.
Obviously a little trickier to do in practice than it is to write about it, but the underlying concept is very useful. If you can figure out an under-serviced attribute that is important to your customers, and you can modify what you do to “own” that attribute in the mind of your customers, you can create a powerful competitive position as well as energize your organization.
