Why Are We Losing Customers?
Posted on Monday, Mar 23, 2015 by Michael Canic

A few months back Fortune magazine published an article about how over the past few years McDonald’s has been losing market share, losing sales, and losing its identity. (http://fortune.com/2014/11/12/can-mcdonalds-get-its-mojo-back/).

Of course, many factors are at play. However, a prime culprit seems to be that McDonalds has lost sight of its competitive value equation – what customers experience compared to what they pay, at McDonald’s versus its competitors.

Some of the value attributes weighted in McDonald’s favor – like fast and convenient – have been losing ground in relative importance to other attributes such as fresh and healthy. Not good news, especially considering Nation’s Restaurant News recently published customer research that placed McDonald’s food quality last among hamburger chains.

In a recent debacle, McDonald’s released “Mighty Wings”. Market taste testing suggested these Hong Kong-style, spicy wings would be a hit. Yet the release crashed, leaving McDonald’s with 10 million pounds of unsold chicken! What happened? Customers apparently balked at the high price point … because McDonald’s failed to make clear that what customers were getting was giant wings. McDonald’s assumed customers would understand the value. Customers assumed they would pay more for less.

And with a menu that has increased fourfold over the past 10 years to over 120 items, what is it exactly that McDonald’s stands for?

What does this mean for you? 1) Identify your distinct customer segments. 2) Determine the attributes that drive value for each segment, and the relative weighting of those attributes. 3) Establish your competitive position based on the value attributes you can best deliver on. 4) Repeat the process regularly to stay relevant in an ever-changing market.

Your thoughts?

Michael

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How Often Should You Revise Your Strategy?
Posted on Monday, Mar 16, 2015 by Michael Canic

Once upon a time companies would create “5-year strategic plans”, go away and work on them, and then come back five years later to start again. Today things change way too quickly – technology, markets, competition – to wait five years before revising your strategy.

Reconstruct
It makes good sense to go through an annual strategic exercise, generally the last 4 months of the fiscal year, to reassess the market landscape, macro landscape (e.g., economic, technological and social factors) and internal landscape, and then reconstruct your strategy as needed. Many mid-size companies do this. Good, but it’s not enough.

Recalibrate
Even within a year, things can change. Working with clients I’ve found it useful to conduct one or two “Recalibration” meetings that segment the fiscal year. What do they look like? Full day sessions at which the top management team questions their previous assumptions and evaluates new data to: 1) determine implications for the existing strategic framework, and 2) identify and prioritize changes and actions to be undertaken.

Real-Time
The third trigger for revising strategy is a real-time major event. The loss of a key customer, the economy goes into free-fall, or the release of a game-changing competitor product, are all examples. When this happens the top management team needs to meet asap to, again, determine the implications, and identify and prioritize critical changes and next steps.

Strategy is a living process that should be both planned and adaptive. How often should you consider revising it? Annually, within the fiscal year, and as circumstances demand. That will keep your strategy real and relevant.

Your thoughts?

Michael

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Five Questions to Determine if Your Business Model is Scalable and Sustainable
Posted on Tuesday, Mar 10, 2015 by Michael Canic

Business is booming and you’re growing at a healthy clip. Great. Buuuuut … is it scalable and is it sustainable?

Think about your business model. You have people (with their various capabilities and traits), processes, organizational structure, and infrastructure (such as facilities and equipment).

1) Which part of your business model is the limiting factor to continued growth?

2) How much more business would it take to cause your current model to fail?

3) What steps and lead times are required to prevent failure?

4) What would the business model of a top performing company twice your size look like?

5) What changes to your model are required to become that top-performing company?

These questions should provoke your thinking about how to manage growth. No, they won’t help you design the perfect organization, but they will help you intentionally design your organization.

Don’t let today’s successes blind you to tomorrow’s challenges. More than a few businesses have grown themselves to death. Model your growth to manage your growth.

Your thoughts?

Michael

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Why Alignment is Critical to Execution, Despite What HBR Says
Posted on Monday, Mar 2, 2015 by Michael Canic

The esteemed business publication, Harvard Business Review, publishes an article in its March edition about why strategy execution breaks down. The authors debunk so-called myths about execution including the myth that execution equals alignment.

Now, as a long-time proponent of ruthless consistency and organizational alignment, you can imagine my interest was more than just a bit piqued.

It turns out the authors' conception of alignment is limited to HR practices such as developing objectives, measures and rewards that are consistent with strategy. Sorry guys, there’s far more to alignment than that.

Organizational alignment is the idea that people, processes, structure and infrastructure all need to be consistent with an organization’s strategy. The right measures don’t keep the wrong processes from failing. The right rewards don’t help if the right boxes aren’t on the org chart. Any critical factor misaligned can cause execution to fail.

The authors go on to identify the lack of coordination across functions or units as a major cause of failure. True. Yet that doesn’t argue against organizational alignment, that is organizational alignment.

So, yes, alignment is critical to execution. And it means much more than simply goals, measures and rewards.

Your thoughts?

Michael

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What the Shoeshine Guy Knows about Leadership
Posted on Monday, Feb 23, 2015 by Michael Canic

So I’ve got some extra time at the Calgary airport. I had just delivered a daylong workshop on Effective Leadership to 50 members of a trade association. I decide to get my shoes shined.

Franklin, the affable shoeshine guy, quickly engages me in a conversation and asks what brought me to Calgary. I tell him.

He immediately asserts, “Let me tell you something about leadership, my friend.”

Oh, maybe I should have attended his workshop.

“I manage four people. Soon, I’ll be opening another location here at the airport. And I will tell you that the most important thing about leadership, it doesn’t matter what business you are in … is respect. Always be respectful of your people.”

Well. Exactly right.

Maybe next time the trade association doesn’t need to hire me. They could hire Franklin.

Your thoughts?

Michael

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What Consistently Growing Mid-Market Companies Worry About
Posted on Monday, Feb 16, 2015 by Michael Canic

Last week we looked at the traits of mid-market companies that consistently grow (according to Inc. magazine’s “Build 100” research). This week: what do those companies worry about?

Tellingly, the top external factor they worry about is not the economy, rising health care costs or other macro factors. It’s rising competition. These consistently growing companies are competitively focused and don’t spend time wringing their hands about things completely outside of their control.

The top internal factor that concerns them is training future supervisors and managers. Successful growth depends on employees who can deliver the brand experience. Which in turn depends on managers who can select, engage and develop the right employees.

Finally, what is the potential event they most fear? Not a security breach, not expanding too quickly … but the loss of a key employee. These companies know that having the right people is absolutely critical to success. They need to get and keep the right people.

Rising competition. Training future supervisors and managers. Losing a key employee. Are you worrying about these enough?

Your thoughts?

Michael

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The Traits of Mid-Market Companies that Consistently Grow
Posted on Monday, Feb 9, 2015 by Michael Canic

Inc. magazine looked at over 100,000 mid-market companies (85-999 employees) to determine which ones had sustained growth from 2007 – 2012 (remember those years?). Of the almost 1,500 companies that qualified they chose to examine a representative sample of 100 – a group they called the “Build 100.”

What are the traits of those companies that stood out? More than anything else, CEOs identified customer service as their company’s top strength. In a world of interminable call wait times, and where finding a service employee is equivalent to a sasquatch sighting, successful companies realize that, yes, service does count.

What do these companies consider the most vital part of their business? It’s not the topics that dominate magazine covers – big data, design, or a flexible workplace. It’s branding – establishing and consistently conveying the integrity of a coherent, compelling brand.

Finally, what do they say sums up the secret to their success? Top answer: execution – the ability to get stuff done. Second: innovation. No other answer even came close. When you can get the right stuff done and get the right new stuff done, you’ve got a good chance to be successful.

Provide exceptional service. Convey a coherent and compelling brand. Execute. That’s what makes mid-market companies successful. What’s your next step?

Your thoughts?

Michael

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When is it time for a CEO to move on?
Posted on Monday, Feb 2, 2015 by Michael Canic

John Montalbano didn’t like it, but it was the right thing to do. As the CEO of RBC Global Asset Management – Canada’s largest asset-management firm – he announced that he would be stepping down.

No, it didn’t have to do with poor results – RBC Global Asset Management has consistently been rated at or near the top of its category. And it didn’t have to do with falling out of touch – Montalbano was just 50. It had to do with a belief.

“After analyzing thousands of companies as a fund manager and as an analyst, I came to a view that CEOs have a due date of eight to 10 years. After that, they either become stale or start to close doors for people around them who are ready to step forward.”

“It didn’t feel good, but it felt right. To me, that’s how leaving should feel: it can never be about you; it’s got to be about your business.”

It can never be about you; it’s got to be about your business. Knowing when to step aside is just as important as knowing when to take the reins.

What’s best for your organization?

Your thoughts?

Michael

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How to Attract Great Employees
Posted on Monday, Jan 26, 2015 by Michael Canic

I continue to hear about companies’ struggles to find top talent. In one company, over 800 resumes yielded just 5 employees!

So how can you attract great employees? Follow these four steps:

1) Attention
You are competing for their attention. And the competition is fierce so you don’t have much time to grab it. Ask yourself, ”Does our website immediately convey that we are a great place to work?”

2) Interest
You’ve got their attention. Now, is what you have to show or say interesting enough to hold it? Don’t make it about you! Make it about them and the people like them – your current employees.

3) Desire
They’re interested, but have you converted that into desire? Do the videos, photos, and copy make clear why you are a better place to work than other companies? Compete!

4) Action
Finally, have you provided a call-to-action, a quick and simple, do-next step to translate their desire into action?

The struggle to find top talent continues. Do you have an intentional, them-centered process to make it happen?

Your thoughts?

Michael

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Customer-Empowerment: The Next Level of Innovation
Posted on Monday, Jan 19, 2015 by Michael Canic

There’s innovation. There’s customer-driven innovation. Then there’s customer-empowered innovation.

Five years ago, outdoor clothing retailer Eddie Bauer launched the First Ascent line for serious alpine use. Yet the market space was already crowded. How to stand out?

By empowering the ultimate experts: world-class outdoor athletes and guides. Empowering those experts not just to provide product input on the front end and feedback on the back end, but empowering them with go / no-go decisions about product designs they’ve tested in the field.

That’s right, the experts get to decide, not the company. Which means their tagline, “Guide built. Guide trusted.” is not just marketing fluff. It’s real.

As Ed Viesturs, a First Ascent guide and the first American to summit all fourteen 8,000-meter mountains, has said, “The really cool part about the process is that in the end, we have the ultimate stamp of approval. If we like it, BOOM, it gets made, and if we don’t, it gets canned.”

You can’t get much more credible than that.

How would empowering your customers strengthen your products and services … and credibility?

Your thoughts?

Michael

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