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 TEN QUESTIONS YOU MUST ASK-
BEFORE YOU GO TO WORK TOMORROW
It's only by asking-and answering that we're able to change-to do better-to grow our business and ourselves.
Start with these questions. Find real, honest answers. Use your answers to get a plan together-and then… do it. Once you've developed the knack-ask your own questions-answer them-make plans-follow through.
- What is your greatest business strength?
Is it your ability to see the job through? To delegate the job? To be involved? To sit on the sidelines and applaud? How can you maximize this strength? How can you use it to make your business more profitable-and make your job easier?
What is your biggest weakness?
Is it your flexibility? Your inflexibility? Your fund of knowledge? Your lack of knowledge? How can you minimize this weakness? How can you eliminate the stress it causes?
- Are you the very best you can be?
(I've always been advised not to ask questions with 'yes' or 'no' answers-but the chances of an honest and resounding 'yes' is slim.) What would make you better?
In today's hurly-burly world, unless you're getting better, you're getting worse-there is no standing still. What would you make better tomorrow than you are today? What small change-improvement-alteration would put you a rung higher than you are today?
Compare yourself to your competitors. What makes you better than them?
Differentiation is valued, because it creates memorability. You want to be remembered. What makes you different from your competitors?
A small p.s. on competitors. Our business environment now exists in virtual reality as well as in 'down the street' reality-so do our competitors.
- Considering your years of business experience, what can you teach those with whom you work?
Share techniques. Offer suggestions based on your success. Be a willing mentor in areas where your experience shines. Grow your business-your department-your staff-your associates.
- Considering others' years of business experience, what can you learn from those with whom you work?
Take advantage of the knowledge gained in the school of hard knocks-by others. Ask for advice. Adapt ideas to suit your situation. Observe not only technique, emulate the attitude, relations building and follow up that promotes success.
Each co-worker has strengths worth emulating. Imagine how formidable you would be if you incorporate the best of others into the best of yourself.
- What in your business environment can be changed-improved-updated?
Be specific. Don't generalize. Where in your business can you think differently? Is it in defining the purpose of your business? Its goals? Is it in looking at your business from your staff's viewpoint? A browser's viewpoint? Your spouse's viewpoint?
Where can you simplify? Ordering? Distribution? Staff meetings?
Where should you focus your energies more specifically? Retaining customers?
Finding new customers? Where can you be faster? Incorporating new products? Adopting new trends? Dropping old forgotten fads?
Where can you energize those around you? Where can you listen better? Find and institute the means to refresh, renew and improve your business continuously.
- Why should someone do business with you… rather than someone else?
Create a three column chart. In column one include all the reasons someone would do business with you-your reliability, compassion, execution, fair prices, etc. In column two include all the reasons someone wouldn't do business with you-your lack of follow through, high prices, inconvenience, etc. In column three include the strategies that would transfer the reasons in column two to column one.
Look at your business from your customers' viewpoint. Who are they? What has changed in their lives? How have you addressed those changes? What new benefits do you provide your customers this year that you hadn't last year? What new benefits are you preparing to provide next year? How are you making your customers' lives easier? Better? What are you doing that anticipates their needs-needs they hadn't yet realized they had.
Never stop asking "why." Never stop making those charts. Never stop looking for ways to transfer comments from column two to column one.
- Fast-forward yourself and your business to the future-five years down the road. What does your business look like?
Aah! The future. It's not the same as it is today. What's happened to your business? How is it different than it is today? How is it the same? Where do you have control in shaping your business' future? What lies outside your control?
- Fast-forward yourself and your business to the future-five years down the road. What do you see as your biggest challenge? What do you see as your greatest advantage?
Things have changed. Your business is different-so is your competition-so are your customers and their needs. What is the biggest difficulty you face? How did you get into that difficulty? What would you do now, to lessen (or eliminate) its impact? What puts you far ahead of your competition in five years time? What did you do to put yourself in this envied position? What else could you do right now to give you additional advantages?
- How good are your communication skills?
We all communicate. Effective, accurate communication holds huge benefits. We all think we communicate effectively, clearly. We don't. We all communicate from our small corner of the world.
This humorous tale illustrates:
A regular customer of a gas station pulled in to fill up. In the back seat of his car sat three penguins. The attendant was surprised and asked-what's with the penguins? The customer replied that he had found them there when he got into his car that morning. The attendant suggested that he take them to the zoo. Great idea, I'll do that, said the customer.
Next morning the customer was back for another fill up-And in the back seat sat the penguins, now wearing sunglasses. The attendant was a little more than surprised and said, I thought you took them to the zoo. Without skipping a beat, the customer replied, I did and they had such a good time, today I'm taking them to the beach.
- In the years you've been in the workplace, what have you learned about yourself?
More importantly what have you done with that information? What have you changed? Improved? What have you "learned to live with?" Why?
By now you must have questions of your own that need asking-and answering. Go ahead-amaze yourself. ASK. ANSWER. PLAN. CHANGE.
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FASTER. CHEAPER. BETTER.
It's the mantra of the new millennium. Today everyone wants everything to be faster, cheaper, better, simpler, more memorable, more convenient, more guaranteed, more fun, more satisfying than it used to be.
It falls on today's marketers to improve-to innovate-to comply and to communicate their 'faster, cheaper, better' products and services-beneficially.
Do just that with these ten effective techniques.
- Use New Technology Advantageously
It's faster for me to send email as long as my message is short, clear and needn't be followed up by fax and phone. How do you do it?
- Add Value
It's more convenient if the florist, who is usually closed evenings or Sundays, will open up to satisfy a customer. How do you do it?
- Improve. Innovate
It's 'newer.' Innovative, improved versions of well known products like zip-locked bags of salad or grated cheese that really do taste better, work faster, stay fresher and are easier to use. How do you do it?
- Research and Development
It's better. The new-to-the-public herb like SAM-e that alleviates feelings of depression and anxiety with very few side effects. How do you do it?
- Clone New Versions of the Original
It's more fun. Products with fruit and nuts, low or no fat versions, hot, medium and mild versions in everything from cereal to salsas to potato chips. It's diapers with dots and spots for girls and boys. It's instamatic cameras for inside or outside, underwater or panoramic shots. How do you do it?
- Create Another Niche
It's more satisfying. Gap clothes for kids. Readers Digest with larger print. Computer programs for toddlers. How do you do it?
- Give Superior Customer Service
It's simpler. The option of "live" telephone assistance at a time when "press one for… press two if you want… press six if…" is all too prevalent. How do you do it?
- Communicate Your Benefits-Differently
It's more memorable. Walking customers to their car-holding an umbrella over them and their groceries because it's raining. How do you do it?
- Get Up Close and Personal
It's cheaper. Calling a regular customer to tell them that new shirts by their favorite designer have just arrived. It's more effective than sending a postcard, too. How do you do it?
- Stay In Touch
It's more guaranteed. Checking after a service call has been completed-just to ensure that everything is working well and answering any questions that may have popped up. How do you do it?
Make faster, cheaper, better your mantra, demonstrating to customers everyday, just how you do it for them.
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CENTRE MAGAZINE IN CONVERSATION WITH SAM GEIST
National speaker, business consultant and author, Sam Geist looks at effective inventory management and the key role it plays in enhancing business profitability.
WHAT IS YOUR BEST ITEM? IS IT YOUR "BEST SELLING" ITEM OR YOUR
"BEST-RETURN-ON-INVESTMENT" ITEM?
Obsession with inventory is a cyclical phenomenon beginning as "hope" prior to each season with new and tried 'n true merchandise purchased to sell in home and hardware stores across the nation-and often ending in "fear," at the close of each season, when large quantities of this merchandise is piled onto discount tables as markdowns.
Is there a way to end this perpetual "hope 'n fear" cycle in our business? I put this question as well as other questions to Sam Geist who has had close encounters with merchandise, as a retailer and has assisted clients, who have yo-yoed their way through the inventory maze, as a speaker and consultant. His practical answers will enlighten and assist you effectively manage your inventory.
Q. At a time when retailers are concentrating on location, staff and service, why are you concentrating on inventory?
A. Out of every retail business dollar spent, approximately 95¢ goes to the cost of goods, cost of doing business, staffing, rent and so on. Of the 5¢ that's left, lost or marked down merchandise very noticeably cuts into your bottomline profits. In retail today there's very little margin for error.
To stay in the game, your inventory performance must be constantly evaluated and improved.
Q. OK. Simple to say. How do you evaluate inventory? What criteria do you use?
A. Actually Vilfredo Pareto, a 19th Century philosopher and mathematician outlined the 20/80 principle we still use today. He theorized that 20% of your customers account for 80% of your sales. Something to think about when trying to reward customer loyalty. As applied to inventory, however, studies reveal that 20% of your inventory gives you 80% of your revenue. Taking this one step further, if some of that vital 20% of your inventory (that gives you 80% of your revenue) is out of stock, is in poor condition, is outdated, damaged, you lose a disproportionate number of sales. Actually your loss is at least four times greater than it would be if you were out of stock of some of the other 80% of your inventory. Each home and hardware retailer needs to use the 20/80 rule in his or her inventory management.
Q. Is there a way to identify this important 20% of inventory easily?
A. Yes there is. It's called GMROI (Gross Margin Return on Investment) and its a merchandise planning and decision making tool that assists the buyer identify and evaluate whether an adequate gross margin is being earned by the products purchased, compared to the investment in inventory required to generate those gross margin dollars.
For every dollar of inventory investment GMROI will help you calculate your return. The industry average is a $2.00 return for every inventory dollar. Some retailers, however are getting $4, $5 or more.
The fashion industry, for example, was built on turns, turns, turns.
GMROI assists buyers change their business' focus from sales to profitability, from percentage that everyone likes to talk about, to dollars. When I began conducting merchandising programs, I used "GMROI" as its title. I asked one of the buyers in the audience what her division contributed to the company as a whole. When she responded with 42% I asked her, "when was the last time you took 42% to the bank" and realized the program title must be changed to "You Pay Bills With Dollars... Not Percentages."
Q. GMROI sounds impressive. What are some of its specific benefits?
A. There is many but let me mention just five of them.
- GMROI reveals where actual dollar profits versus paper profits are attained in the merchandise plan.
- It focuses the buyers' attention on return-on-investment rather than sales as a basis for merchandising decisions.
- It focuses the buyers' attention on SKU's (stock keeping units) of each individual product rather than department totals.
- It identifies product "winners" and those products "starving to become winners."
- It identifies "core" business/never outs.
Q. What are product "winners" and products "starving to become winners?"
A. Product winners are those products, which perform well-which boost profitability. They're the best-return-on-investment products. The ones that "turn" frequently. The "starving o become winner" products have all the capabilities of becoming winners, if only... there was more selection, they were available, they were visually merchandised well and so on.
Q. What are "core" products, never-outs?
A. This is the buyers list of existing winners that can never be out of stock. They're the most valuable products in terms of their high profitability, their excellent return on investment. Keep in mind that the "never out" list changes seasonally or by location. Managing your core business, your highly priced 20% of merchandise assures inventory productivity and bottomline profitability-the reason you are in business in the first place.
Q. One last question, how do you calculate GMROI?
A. For readers who want all the details and aren't attending a GMROI session soon, I've included a comprehensive section in my book, "Why Should Someone Do Business With You...Rather Than Someone Else?" that includes examples and a practice page. Here, however are the steps to determine the GMROI formula:
- Calculate your gross margin or realized gross margin as a percentage.
- Calculate the value of your average inventory at cost.
- Divide your total sales by your average inventory at cost. This will give you your ratio of sales to inventory investment.
- Multiply the result of #3 by your gross margin percentage (#1) to get GMROI.
Today there are computer inventory control systems to assist you. Once installed and used, such a system makes quick work of determining your GMROI. Having a firm handle on your inventory not only ensures that "winning" inventory is available, but also permits you to significantly reduce levels of marginal inventory, thus saving a great deal of initial investment.
The beauty of GMROI is that it works for any size store, department or merchandise classification. It will work for each category in each department, each class in each category, each color, each size in each class and so on.
Keeping a close eye on your GMROI results will enable your inventory to work as hard for your business as you do.
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THE FACTS OF LIFE
On the eve of the new millennium these are the facts of life for every marketer who wants to stay in the game.
Fact # 1:
Mass Marketing is OUT
Marketing to a Customer of One is IN
Customization shows you are really interested in each customer-and customers love the feeling that they really count.
In supermarkets across the country, produce marketers are into dozens of lettuce choices for their customers, from bagged, washed and organic to exotic mixes, greens by the pound and packages with packets of dressing included. Customers are eating it up.
How are you addressing the individual needs of your customers? What else can you do right now?
Fact # 2:
Price, Quality and Service are OUT
Value-Added is IN
Price, quality and service are a given - they're not perceived benefits anymore. They are expected.
Gas stations, department stores, supermarkets are adding value by offering Air Miles with purchase. Their customers are happy to buy and collect those miles.
What are you adding to your service-your products, to stand out from the crowd? What value-added can you provide that goes above and beyond?
Fact # 3:
Monologuing is OUT
Dialoguing is IN
Talking to yourself is a waste of time. You already know what you're thinking. You want to find out what your customer is thinking. You want to find out what your staff is thinking. Ask questions. Listen to the answers. Use those answers to make changes.
GM decided that its Cadillac was too long and shrunk it. Sales shrunk too. When GM decided to give customers a chance to share their ideas, the new DeVille and Fleetwood resulted. Sales grew by 36% from the year before. Dialoguing offers big benefits.
How can you get dialoguing in motion in your business environment? What steps can you take to ensure your dialogue is continuous-is ongoing?
Fact # 4:
Standing-at-the-ready is OUT
Moving is IN
Standing still, even if you're on the right track will still get you run over. Moving is essential for survival. Customers expect innovative action; they demand evolution. Customers expect you to get better. Good enough today is not enough tomorrow.
IBM, long a computer giant has moved to where their customers need them by providing service contracts for their equipment. That move now represents 30% of their business. How are you innovating?
How are you moving forward? What else can you do to be better today than you were yesterday?
Fact # 5:
Celebrating "Getting the Order" is Out
Celebrating "Keeping in Touch" is In
It's no longer finished when your customer signs at the "X" on their credit card slip. That's just the start of a beautiful relationship. Smart marketers stay close to customers after the sale-making certain they are happy with their purchase, providing them with more of what they want, remaining top-of-mind so customers will think of them when they are ready to buy again.
The dress boutique where my wife shops (often) calls her to ask about the party she attended (that's why she bought the dress) and to remind her when new merchandise arrives that they think she might like.
How do you celebrate "keeping in touch" with your customers? What else can you do to keep customers close after the sale?
The facts of life are simple. They are all about making your customers satisfied and comfortable in dealing with you no matter where you operate-real space or cyberspace. They're all about making customers glad that they decided to spend their hard-earned money with your business. They're all about making customers eager to come back again and again (and bring their friends).
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THE FACTS OF LIFE - Part 2
In the last article, five essential facts of business life were outlined; this completes that list.
Fact # 6:
"If it doesn't seem broke-leave it alone," is OUT
"If it doesn't seem broke-check it out anyway," is IN
Unhappy customers don't always complain-to you. Complaining customers are a godsend; they offer the opportunity to rectify the situation. Customer feedback-complaints and compliments are invaluable.
My wife received an orange customer comment card with her purchase of a Zenith shower corner caddy. She found the information on the caddy box to be inaccurate and the directions for assembly to be obtuse. Zenith had asked for feedback! She sent in the card together with a detailed letter of explanation. They never replied. Not a word. Better not to have included the card.
How are you soliciting customer feedback? In what other ways could you gather feedback, comments? How is the feedback used?
Fact # 7:
Patting yourself on the back, for the excellent job you've done is OUT
Continuously working to improve, to get better is IN
Good enough yesterday is not enough today. Customers don't care much about back-patting (especially if its not on their back), they care about improvement-they expect continuous improvement-on-going innovation by the people with whom they do business.
Grocerygateway.com initiated a grocery delivery system to save busy professionals the time it takes to go to the supermarket and shop. The customer fills out a shopping list on-line or by fax. The "shopper" goes through the supermarket with the cart, "buys" whatever was requested and delivers it at the specified time. Guaranteed. Their improvement? Soon the groceries will be left in a secure locker so the customer doesn't have to be at home when the food is delivered-if that is more convenient. If only someone would show up to cook it too-now that would be another great improvement.
What improvements have you made in your business in the last year? Last six months? What other improvements can you make?
Fact # 8:
Creating and maintaining borders is OUT
Stretching boundaries is IN
The web has seen to that. With lightning speed, business has become global. The borderless cyber-marketplace offers the opportunities to those willing to stretch themselves. On-line customers are looking for innovative marketing, value-added features, interesting and valuable information, great offers on the web sites of entrepreneurs.
For good or bad, airlines have invaded the territory of the travel agent; not only by selling on-line discounted flight tickets, but offering accommodation and car rental packages as well. Travel agents are furious and determined to retaliate. When boundaries stretch, they blur the lines of competition.
How can you stretch your boundaries to your advantage? To the advantage of your customers? What would your plan look like?
Fact # 9:
Knowing all the answers is OUT
Asking the right questions is IN
Questioning inspires thought. New perspectives are discovered, new possibilities are entertained, new ideas are discussed-and new solutions are sought. Leaders who ask questions, grow their people, grow their organization.
From the book, "Why Should Someone Do Business With You… Rather Than Someone Else?" are a few questions worth asking and answering.
- Why should someone do business with you… rather than someone else?
- Would you do business with you? Why? Why not?
- Where do you see your business in a years time?
Five years from today?
- What are you doing in your business to stay on the cutting edge of the 'new' marketplace?
- If your business disappeared from the face of the planet tomorrow, would anyone notice-would anyone mourn?
Fact # 10:
Being a boss is OUT
Being a leader is IN
A boss says "go." A leader says "let's go." Leadership is a hot issue. Witness the volume of press given the subject. No matter if one is a leader of multitudes or a leader of one (self), the primary goal is to catalyze everyone so they can catalyze each other.
Mary Livingstone tells the story of an expedition into the wilds of Africa, where her small group was accosted by renegade revolutionaries bent on stealing their possessions and doing away with them. Their saving grace she related was one fellow in her group, who "talked" with the renegade leader softly, assertively and persistently until the leader decided that taking a few things and disappearing with his troop was good enough. She was certain it was this fellow's calm demeanor, his ability to relate to the enemy, his persistence at holding his ground (respectfully) that had prevented disaster. The stuff of a leader.
What leadership qualities do you admire most in other leaders? How can you adapt those qualities to suit your particular environment? What compelling reasons can you give your followers to follow you?
These are the facts. Simple. Easy to follow. Use them for the long term success of your business.
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WOULD YOU WORK FOR YOU?
Would you? Would you go into the trenches for you everyday-and be glad you did? Do your leadership skills, values and vision inspire leadership-or do they encourage dreams of escape?
Being an effective leader today-in a huge organization or in a proprietorship of one is tougher than at any previous time, due in large measure to marketplace changes occurring faster than ever before-and decision making following suit with equal speed.
That said-becoming an effective leader is certainly attainable. It only takes hard work, dedication, knowledge, up-to-date information, empathy, skills, enthusiasm, ability, an innovative and inquisitive mind, …
Start your quest to become an effective leader with these three leadership principles, so that you would work for you-
- Know Yourself
Confront yourself with an honest eye. You needn't look for perfection in the mirror. Few leaders are perfect. You must however, see yourself as you really are-with all your warts. Take time to recognize your specific strengths and capabilities. Use your energies to maximize them.
Recognize your weaknesses. Develop a plan to minimize them. Ask yourself, what makes a great leader? Determine the characteristics of someone you would like to work for-and then become that person, in your ideas, your vision, your attitude and your actions.
- Know Your Role
Without a doubt, one of your principal responsibilities is the acquisition of accurate information, its correct assessment and the effective decision making that results. However, your most important responsibility is to ensure that your staff takes ownership of their role. You can tell if you have been successful, simply by observing their actions.
While leadership style, like Herb Kelleher's, for example, provides great fodder for conversation, it is a much less important attribute than the actual demonstration of leadership.
Recent studies noted that participants focused on two issues when discussing effectiveness of their leaders-management skills and supportive facilitation (not style). And within those two issues, skills were indeed considered valuable, however it was the leaders' every day behavior that provided motivation or dreams of escape.
- Know Your People
Today's workforce is much changed from "the good old days" when a 30 year long, nine-to-five, local job was the norm.
Our work world has no borders, no regular hours, no long term loyalty. Staff, often young, comes from diverse backgrounds, unfamiliar with "the way it used to be." The work itself is altered. For example, highly specialized interdependent teams frequently replace individuals working in isolation.
Such situations create new and often unprecedented challenges for today's leaders. Those who are adept, flexible and future-focused, turn challenge into opportunity by embracing the new parameters and using them to move forward.
Seek out the most talented, energetic and creative staff-and get to know them well. Find out what makes them tick. Discover their needs, interests and goals. Notice hidden capabilities, unused talents.
Give your staff gifts-big gifts-like opportunity, space to grow and develop, exhilarating challenges, purpose to their work, trust, recognition and empowerment. The gifts you give will be repaid many times in staff loyalty, productivity and bottomline profitability.
Yes! Leading in the 21st Century will be tougher-more demanding than ever before. It will require putting together a plan that includes knowing who you are, what your role is and who your people are.
Effective leaders have already begun. They ask questions. They search for the most appropriate answers for their situation and then they "do." They act-they motivate-they lead.
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WOULD YOU WORK FOR YOU?
Download PDF of Would You Work For You? ISPI.
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List of Sam's Recently Written Articles
- Why Should Someone Do Business With You?… because you know your customers
- Why Should Someone Do Business With You?… because you are different
- Why Should Someone Do Business With You?… because you set the stage
- Why Should Someone Do Business With You?… because you take an innovative approach
- Why Should Someone Do Business With You?… because you have vision
- Why Should Someone Do Business With You?… because your staff are ambassadors
- Why Should Someone Do Business With You?… because you understand the dynamics of leadership
- Why Should Someone Do Business With You?… because you're different-special-better
- Why Should Someone Do Business With You?… because you give big gifts
- Why Should Someone Do Business With You?… because you really "do" customer service
- Why Should Someone Do Business With You?… because you are a catalyst for action
- Why Should Someone Do Business With You?… because you ask questions
- Retailing In 2010
- Less Is More
- Retailing 2001: Thriving in the New Millennium
- If Your Business Disappeared From the Face of the Earth, Would Anyone Notice, Would Anyone Mourn?
- Make It Stick
- A boss says go. A leader says "let's go!"
- What If?
- Close Your Eyes and Fast-forward to the Future
- Art of Selling
- You Pay Bills With Dollars… Not Percentages
- What You Should Learn from Failure
Please feel free to contact us for any of the articles that are of interest to you.
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