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Business Makeover
7/7/2011 8:01:36 AM
Do you need a makeover? There are several reality TV shows that have become popular by either helping people de-clutter their homes, revamp their houses, discipline their children, lose weight, or find a mate. You name it, Americans have a fascination with makeovers. In typical style, these shows have little to do with tweaking what is already going on as much as it is bulldozing one’s life and starting from scratch.

Have you considered a makeover in your business? If you have been watching your sales take a pounding, you have probably had several of those tense what-are-we-going-to-do-differently meetings with your sales and marketing staff. The outcome of such meetings is inevitably that change is needed, in one way or another, because simply standing pat does not hold water when the recession has shot holes in your old business sales bucket. If a makeover is inevitable, what sort of change will you make? Here are some strategies you may want to consider

Getting back to your roots

In 1989, United Airlines aired a poignant commercial in which a sales manager announces to his staff: "I got a phone call this morning from one of our oldest customers. He fired us. After 20 years, he fired us. Said he doesn’t know us anymore. I think I know why. We used to do business with a handshake, face-to-face. Now it’s a phone call, a fax, ‘get back to you later,’ with another fax, probably.” Now this was aired before we had text messaging and email, but the point is that as businesses grow, they can grow away from the service (and customers) that made them good in the first place. During economic hard times, this is challenged all the more. Companies have less dollars to throw at golf outings and networking events that are the backbone of one-to-one contact with your customers. That does not mean you need to lose contact or the perspective on the importance of relationship-driven selling. What must you do to keep your clients happy? What can you do to gain the trust of new clients? Getting back to your roots is a first step. This may mean that your sales staff will have to do some cold calling that they did not need to do just a few years ago. It may mean that you will have to readjust your marketing strategies to get in front of your client on your initiative instead of waiting on them to come to you. That United Airlines commercial ended with the sales manager saying he was going to fly out to see that old client. That may be your best first step.

Zig when all others zag

During the Great Depression, patents for new innovations fell as sales collapsed. Companies just did not have capital to spend on research and development. However, there were some companies that bucked this trend. One of them was the DuPont Corporation. They actually spent more on R&D during the 1930s than they did before the Great Depression. Even as their sales fell by 15% in 1930, they made a strategic decision to push ahead with the development of several synthetic rubber and plastic projects. The results were the invention of nylon and neoprene, among other materials that became the hallmark of DuPont’s growth in the middle part of the century. While other companies were trying to hold their own, DuPont came out of the Great Depression as the world leader in their industry.

Take a good look around you. What is your competition doing during these slow sales cycles? Look for innovative ways you can differentiate yourself from the rest of the pack. Set yourself up for success once the economy turns around.

 Wrecking ball or a hammer?

There are times when the old model needs to be fixed up. There are other times when the old model needs to be demolished and a new model constructed. Smith Corona was a world leader in office machines for nearly 100 years. They produced typewriters. They were very creative within their industry, coming up with items like the portable electric typewriter and replacement ribbon cartridges that kept your hands from being smeared with ink. When the personal computer began to replace the typewriter, Smith Corona made a strategic error: they decided to stay the same. Unwilling to see the end of the line for the typewriter, they saw their sales of typewriters and components decline until they filed bankruptcy in 1995. It may be that your product offerings need to change. It also may be that your sales methods need to change. The Fuller Brush Company was founded by Alfred C. Fuller in 1906. His method of selling household products door-to-door made his company synonymous with the technique. However, the world changed and its perspective on door-to-door sales soured. With declining sales, Fuller Brush Corporation changed its sales method in 1992, allowing sales staff (both men and women) to form buying networks of friends and family. It eliminated the middle distribution position and let the sales reps deal directly with the company. This was a major shift away from the way FBC had always operated, but it was necessary for the life of the company.

 What changes do you need to make to keep sales coming your way? In a recession, standing pat is a recipe for going out of business. Evaluate how you are going about sales and don’t be afraid to challenge your old way of doing things.

___________________________________

Innovation Lessons from The Great Depression, by Graham Griffith. Global Economic Watch, http://community.cengage.com

 Innovation lessons from the 1930s, by Tom Nicholas. McKinsey Quarterly, December 2008, http://www.mckinseyquarterly.com

 Smith Corona Corporation history http://en.wikipedia.org/wiki/Smith_Corona

 Fuller Brush History, http://www.fullerbrushdwt.com/history.htm

Photo by Carrie Bottomley

 

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