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Why Small Businesses Should Embrace Change

Many small business owners lament the fact that just when they’re feeling comfortable with their business and their clients, something always happens. It could be a key employee leaving, or the marketplace suddenly changing. You might wake up one day and find that you have a brand new competitor poised to lure away your customers. Running a small business is hard enough, but how can you compete when things are changing all the time? Sometimes it seems that no matter what you do or where you turn there are nothing but obstacles standing in the way of your success.

This is not the way a successful business owner thinks. If this is the way you run your business you’ll always be reacting to the latest situation and you’ll spend much too much time trying to maintain the status quo when in fact you should be doing the exact opposite.

Stop wanting things to stay consistent in your small business, instead start understanding that the only consistent thing in life -– and business — is change!

If you want something to happen, no matter how small or seemingly insignificant, there’s an element of change that needs to occur for that something to take shape. When you think of it that way, fighting change becomes useless and counterproductive.

Start thinking of change as your friend, and not your enemy. See change as the great catalyst it is — something that can accelerate events, keep things from becoming stagnant, and make all things possible. Would you rather use your energy pushing against something or going with the flow? You’ll go farther if you keep the winds of change at your back, and not blowing in your face.

Once you get that mind-set, you’ll lose the attitude of “Okay, what’s going to go wrong next?” Instead, you’ll find yourself saying, “I wonder what my next opportunity will be?” This shift in attitude also changes the way you view and pursue success. Never again will you sit still and wait for success to come to you. You’ll now understand that to have success you need to go out and actively seek it.

This simple change in thinking is amazing. When you understand that change is always right around the corner, you have the edge over your competition. Instead of looking at your business as a constant, stagnant thing, you’ll view it is a work in progress; a living, breathing entity that’s always be changing and evolving.

In fact, the healthiest, most robust businesses embrace change and acknowledge that the world doesn’t sit still. Successful people view change as a metamorphosis of sorts. They also understand that since change is inevitable, they need to always be on the lookout for new opportunities.

In its simplest form, acknowledging change, embracing it and working with it, rather than against it, puts you in the driver’s seat. You’ll be among the first to spot trends, new market opportunities and ways to stay ahead of the competition. All in all, you’ll find that the more you love change, the more successful you’ll become.

For a free weekly ezine with valuable tips for your small and mid-size business go to http://www.theprofitrepairman.com. Tom Marquardt, The Profit Repairman

Company Gifts – For Employees and Executives

There is always a budget for company gifts in most companies. These gifts should be given to employees, executives, clients and other loyal patrons during some certain events or occasions. However, it can sometimes be difficult to decide exactly what to give to whom. Countless business gifts available in online stores will give you different choices of items you may give to each of your receiver. Purchasing the right choices off business gifts can definitely help your deep gratitude towards your receivers.

For employees, your best choice may be to to completely and evenly divide your budget between these people and buy the same thing for the rest. This is to show that you are just thinking equally and not dealing with favorites. Buy purchasing in bulk, you can also save money. However, if you purchase same gifts for everyone, consider something that can be very useful for them. Therefore, what you will choose are gifts that are not gender-specific and are those that don’t require you to choose sizes.

Of course, it is always welcome to purchase different presents for different individuals. You may want to consider each of their likes, hobbies, tastes and lifestyles. Many people not only companies opt to give different types of gifts for each person. This is one way of making sure that they will really get what they want. If in case your company or organization has volunteers or major donors, it may be a great idea to get them a special present around the holiday or on other special celebrations. Also, you don’t want to forget the members of the board of trustees. These people are very vital on your company, thus if you have money in your budget for executive business gifts, it’s completely absurd not to spend it.

Present gifts for employees during your company’s annual recognition day, or even on simple appreciation days. Of course, you want to give something that has a bit of elegance and sophistication. One of the most ideal gift to give for the most outstanding employee of the year is plaque or trophy. Today, you can find lots of beautiful and elegant plaques and trophies that aren’t ordinary as with traditional ones. You may consider an Engravable Super Star Trophy, a mix of fun and elegance for your company’s hardest working employee. This will surely give the most outstanding employee an inspiration, as well as a chance for him or her to display that special achievement. Don’t forget to engrave his or her name as well as inspiring words to make it more memorable.

Lastly, you should also save some executive business gifts for your loyal clients. Giving executive business gifts to your clients during holidays or other events help strengthen your good business relationship with them. This is one way also to make sure a repeat business with them. You may give personalized picture frames and albums, desk clocks, business card holders, business totes,pocket watches and other beautiful gifts that can carry sentiment of t hanks for your loyal patrons.

Jnet is a writer and interested more about weddings. Often focusing on a specific aspect of the event that would charm your look such as jewelry gift boxes and executive gift basket.

Free Conference Calls – Everything is Becoming Free These Days

There is a change ahead that most everyone will appreciate. You, your company, and your organization can take advantage of services that are becoming available for free including free conference calls. Imagine that you will be able to save money on valuable services and possibly eliminate a whole bill a month. There is no better way to get the most of a service than using it at no cost to your or your company not just for limited time but all the time. With everything becoming free that can only help your company’s growth and development. Taking advantage of services becoming available at no cost will benefit every company and organization.

When it comes to making a conference call many companies and organizations need to make several a day to make sure business gets done. That being the case for many means a high monthly bill for this service. Finding a company that provides this service to your company or organization at no cost to you will be a valuable asset. There is no doubt your company will always need this service to keep business running as usual and provide the best service for your customers. So finding a free way to provide that service is not only beneficial to your company but everyone your company deals with on a regular basis.

With services like this becoming free every day companies and organizations will be able to communicate with as many people as they need to. Most generally being able to do that for as long as they want will accomplish so much more than trying to limit the calls and the time. Being free to communicate with who you need to communicate with will allow your company and organization to have a great edge in your business.

Bringing this time of valuable change to your company will be easy when you mention that the service is free. Once people hear that word they listen, so when it comes time to changing services to benefit business you can do that for your company or organization at no cost to the company. Knowing about the services that your company can take advantage of for free is important in saving money and in giving your customers the best service you can. Keeping budget or staying under budget will be possible when taking advantage of this free service.

Conferencing calling has always been the key to many businesses success when it comes to expansion and growth. However now with this service available to your company for free that budget doesn’t have to increase. Now you can concentrate on taking your company to new successful levels with unlimited services such as these at no cost budgets will be kept and your company can provide customers with new products and services. Who would have thought that we are actually in the day where services are becoming free almost every day? Begin saving your company’s budget when you take advantage of free conference calls.

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Free Stuff Doesn’t Everyone Love It

Hearing certain phrases may spar your interest just a little especially when you hear free stuff because after all everyone loves complimentary services and sample items. These days when you hear those words you want to investigate what is being given away. When you can take advantage of services and samples that do not cost you anything there will be more money in your pocket or your business’s pocket. Some may be surprise that there are complimentary products and service s that businesses can take advantage of as well. Everyone loves receiving complimentary services and free samples even at work.

Many times companies offer introductory products and services to give you a taste of what they have to offer you or your business. Not often do companies provide on going services or give you enough of a product to last you as long as you need it. However because of being able to sample or try a service with no cost you may choose that company from now on. What if you found a service that is complimentary all the time? Now that is something that you can really love because it will save money all the time.

Finding complimentary services for limited times may be a popular thing for your personal needs. There are not as many opportunities for complimentary services for your business let alone ongoing services. Since it is no secret that everyone loves to get free stuff why shouldn’t there be complimentary services available for your business or work place? The answer is there should be and there is. Finding those services may take a little research but there are products and services you can not only utilize at home at no cost but also in your workplace.

Saving your business or company money will not only be a plus if you are the owner but if you are an employee as well. Giving your employer information on how to receive complimentary services or products on an ongoing basis will make them happy. Because everyone loves receiving as much as they can get at no cost to them. You may save the budget this year when you find a service your company uses often but pays for. When they can get it at no cost you have just help eliminate that expense from your company’s yearly budget. Now that is something to love.

Having your own business may mean that when you find a complimentary service your business can spend that money in promoting the business. Finding services at no cost will allow some room in the budget for that marketing campaign you want to launch. Saving money in one are will allow you to spend it in another area that will help your business grow.

When you hear about complimentary services and products let your interest perk up to see what they are offering you may be able to tap into something that will save money all the time. Whether it is personal, small business or big business there is no doubt that everyone on every level loves to receive free stuff.

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Free Conferencing – A New Age in Conferencing

Providing your business or company with all the latest in services is important for success. When it comes to conferencing a new age has begun with free conferencing now available. There is a cutting edge to receiving a service for free that your business or company depends on. In this day when something like this comes along it changes things for the better. Your company or business will now have all the conference calls they need to make for free. The budget for those weekly phone meetings with all your affiliates can be cut totally when you have this service.

Getting the team together at the office on a regular basis for those conferencing brain storms or meetings for free could change things for your business or company. Eliminating an entire yearly budget from the books is definitely a new age in today’s business world. Usually you have to pay for each service you receive separately. Businesses and companies are charged for having multiple phone lines, each line, an 800 number, a fax number, voicemails, conferencing, and long distance as you can see paying for each one of these services adds up.

Even though many companies and business budget for all of their services they need this day and age everyone needs to take advantage of complimentary services when they can. Not often is there a service that is offered that can be used all the time by companies and businesses at no cost to them. In fact many may take advantage of companies and businesses because of the money they assume they have. Even the largest corporation in America should be able to save money when they can their success helps promote success of America’s economy. When they can take advantage of a new service that is totally changing a specific market at no cost it helps them be able to keep more jobs, and provide customers with more services.

Think about your company or business being able to eliminate the entire conferencing budget. Those funds can then be put back into the budget to help in other areas that may need it more. Cutting conference calls for most businesses and companies is not an option because they have many locations across the United States and the world. Weekly meetings, monthly meetings not just for one department but all departments can really add up on the budget. Eliminating that budget totally all the time is definitely a new age in conferencing that every business and company can take advantage of.

Providing services that cost companies and businesses nothing all the time will change the success rate of every business for the positive. Small businesses can now save when they have to make those weekly and monthly calls as well eliminating an entire budget for a small business can help its success rate. Services provided for free will help businesses and companies make more profit and with conferencing for free they will be able to communicate more and spend time on important issues that will help bring success.

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5 Keys For Maximising Your ROI Through Optimal ERP Performance: Key 5 - Maximise Your Benefit

Key No. 5 – Maximising The Business Benefits And Return On Your IT Investments

It goes without saying that, despite the best planning and implementation processes, the proof of an ERP project is in the business benefits and the return on investment achieved. A well-executed project is less than successful if there are no benefits or returns. This should be obvious to all, and this should be the primary focus of every project, in any field.

But judging by the number of ‘failed’ projects – whether this means never being completed or simply not living up to expectations – one would be forgiven for wondering if this overriding priority is forgotten in many cases. The attitude that “the operation was successful but the patient died” must be avoided at all costs, and it is an attitude that must be avoided throughout the project lifecycle.

Realising the benefits of your ERP implementation is determined by the actions taken in the initial planning stages of a project, as well as the result of how well the system is used once it is up and running. Poor planning can mean limited or even zero benefits or, at worst, a highly negative impact on the organisation. There are cases where organisations have suffered terminal effects of a poor implementation.

Companies focus on the process of selecting and installing ERP software systems but once the initial project is complete, it often happens that both the original team and the business focus move on, whether or not all the original goals have been achieved. The end result is something of an instant legacy system, with no budget or plan for further training or realisation of business objectives.

It cannot be emphasised enough that business benefits come after the project is complete. This is often a difficult issue to manage during the implementation phase, as those involved require faith in the project that the benefits will be achieved, but often see little evidence of this during the implementation itself.

A good example of this is in the consideration of modifications. It is often easier for project teams to request a modification to maintain the status quo and appease business users rather than try and introduce an improved process. For this reason any modification must be endorsed by the business leader most affected by the modification and reviewed by his peers.

Where possible the benefits should be built into operational plans budgets to ensure they are realised. This will encourage business managers not directly involved with the project to maintain an interest as they know they will be measured once it is in operation.

Joe Peppard et al referred to this in an article in MIS Quarterly Executive (called MIS1 from here on): “With the information technology investments, most organisations focus on implementing the technology rather than on realising the expected business benefits. Consequently, benefits are not forthcoming, despite a project’s technical success.”

They go on to say: “When considering return on investment calculations, organisations are so pre-occupied with manipulating the denominator – reducing spend – that they do not focus on the numerator – how IT can generate significant benefits. Equally worrying is the traditional investment appraisal process, which is often seen as a ritual that must be overcome before a project can begin. Many benefits are overstated to get the project through this process.

“No wonder few companies engage in post-implementation reviews. They already know that many of the benefits described in the business case are unlikely to be achieved.”

As cynical as this last judgement is, there is an element of truth in it. But it needn’t be so. There are ways to ensure – or, at least, to maximise – the business benefits that your ERP implementation can achieve.

Peppard et al, in another article (MIS Quarterly Executive, March 2008 - called MIS2 from here on), say “There is an important difference between investment objectives and benefits. Objectives are overall goals or aims on the investment, which are agreed on by all relevant stakeholders. In contrast, benefits are advantages provided to specific groups or individuals as a result of meeting the overall objectives.”

They suggest (in MIS1) that, underlying an ERP project proposal, there should be five principles adhered with in order to realise value through IT.

Principle #1 is that IT has no inherent value. “Just having technology does not confer any benefit or create value. The value of technology is not in its possession. In fact, IT spending only incurs costs. Benefits result from effective use of IT assets.”

Principle #2 is that benefits arise when IT enables people to do things differently. “Benefits emerge only when individuals or groups within an organisation, or its customers or suppliers, perform their roles in more efficient or effective ways. Generally, these new ways of working require improving how information is used.”

Principle #3 says that only business managers and users can release business benefits. “Benefits result from changes and innovations in ways of working, so only business managers, users, and possibly customers and suppliers, can make these changes. Therefore, IT and project staff cannot be held accountable for realising the business benefits of IT investments. Business staff must take on this responsibility. Getting business staff to acknowledge this principle is a key way to ensure that they become involved in so-called IT projects.”

Principle #4 reminds us that all IT projects have outcomes, but not all outcomes are benefits. “Many IT projects produce negative outcomes, sometimes even affecting the very survival of the organisation. The challenges for management are to avoid such negative outcomes and to ensure that the positive outcomes deliver explicit business benefits.

Principle #5 says that benefits must be actively managed to be obtained. “Benefits are not outcomes that automatically occur. Furthermore, the accumulation of benefits lags implementation; there can be a time gap between initial investment and payoff. Therefore, managing for the benefits does not stop when the technical implementation is completed. Benefits management needs to continue until all the expected benefits have either been achieved, or it is clear they will not materialise.”

To implement an ERP project based on their five principles, Peppard et al recommend that seven key questions should be asked, the answers to which “are used to develop both a robust business case for the investment and a viable change management plan to deliver the benefits”.

These questions are:

• Why must we improve?

• What improvements are necessary or possible?

• What benefits will be realised by each stakeholder if the investment objectives are achieved?

• Who owns each benefit and will be accountable for its delivery?

• What changes are needed to achieve each benefit?

• Who will be responsible for ensuring that each change is successfully made?

• How and when can the identified changes be made?

They do warn (MIS2) that “Some benefits can only be measured by opinion or judgement. … Quantifiable benefits are ones where an existing measure is in place or can be put in place relatively easily. Since quantifying benefits inevitably involves forecasting the future, the challenge is to find ways of doing this as accurately and robustly as possible.”

But an ERP system does not stand alone, and realising benefits often relies on other, external inputs. ERP software systems are largely data dependent and data driven and the key to realising the full benefits is integration. If information is incomplete or inconsistent it becomes very difficult to integrate reliably and the results can lead to a loss of business confidence in the system and increased non-productive work load for support personnel.

Often day-to-day operation of systems falls to staff who weren’t involved during the initial implementation and who have not received the same levels of training and handover as the original team. As a result effective system usage tends to deteriorate over time.

Your approach, then, to realising benefits of an ERP implementation (or any IT project, for that matter) relies on taking an holistic approach, which means not just all participants and stakeholders, but also all inputs. And this also means across the entire spread of a project – from the very first inkling of a suggestion or realisation of a need, to the end project and, importantly, beyond – to the ultimate users and how they will react to and live with the system that has, hopefully, been fully implemented. An implementation is not successful until anticipated benefits are achieved – largely after implementation – or a good reason established for why they won’t be. Responsibility, therefore, for doing this rests with many players, at many stages.

Complex? Yes.

Difficult? Maybe.

Essential? Absolutely.

References

• Clarke, P., “How to maximise your investment in ERP technology”, June 2008, IBS Australia

• Peppard, J., Ward, J., and Daniel, E., “Managing the realisation of business benefits from IT investments”, March 2007, MIS Quarterly Executive

• Ward, J., Daniel, E., and Peppard, J., “Building better business cases for IT investments”, March 2008, MIS Quarterly Executive

To subscribe to the entire article series visit http://www.supplychainsecrets.com.au

Peter Clarke, Chief Technology Officer IBS Asia Pacific has over 20 years experience in ERP Software, ERP Systems, Supply Chain Management Software and EAI.

Value Adding and Waste Activities in Supply Chain

Any business is composed of many processes. All of those processes have direct or indirect impact to the main activity – serving the customers. Customers expect to receive product and/or service from their supplier that will satisfy their needs.

Usually, more than one company is competing for the same customer base. Eventually, the customer base is split based on chosen supplier. What is the reason for customer to choose one supplier out of many? All suppliers are competing to satisfy customer’s needs by offering them a certain value. This value is represented as ratio between benefits and price. More benefits for less price gives greater value to the customer. So, the product/service needs either to have bigger benefit for the same price, or lower price for the same benefit, for some company to be chosen as a preferred supplier.

When we come to cost structure, that affects the value delivered, we find many process steps that increase, directly or indirectly, the price of the product. These activities can be value adding or waste activities.

Value Adding Activities

Since customer appreciate greater value that he receives from his supplier, any activity that customer cares about is value adding. Any activity that improves the product appearance, functionality, durability, satisfaction and brand loyalty is value-adding activity.

Also, value-adding activity is any activity that changes the product itself. This can be in any step in raw materials manipulation, production, or adjustments and packing of the product.

Finally, any activity that is done properly from the first time can be considered as value adding. Obviously, failure to achieve activity from the first time does not add to the value of the product.

Waste Activities

Unfortunately, there are many waste activities that are waiting any company during their activities. Wastes are sometimes even difficult to detect, especially in case that proper structure of key business indicators is not implemented. There is a whole range of wastes that can generate in Supply Chain:

Overproduction – This Type of Waste can happen in case of greater production versus demand, or in case of inaccurate forecasting. In some cases overproduction can be justified, like pre-stocking prior to the main sales season.

Unnecessary Inventory – It is true that higher inventory is the protection from uncertainty of demand and from OOS, but too high inventory does not add value. From financial perspectives, high inventory level is capturing the working capital, that can be used for better purpose ( investment, interest, etc. )

Defects can slow down or stop production. Low productivity and scrap are increasing cost per unit produced.

Inappropriate processing due to inadequate technology or design can produce waste.

Waiting of item in the queue to be process does not add value to the customer.

Transport is an important part of operations, but unnecessarily movement of products is not adding value

The optimum price of the product is achieved by proper balancing of activities. Value adding activities should be optimized, while waste activities should be either reduced or eliminated.

Laurus Nobilis has 11 years of experience in FMCG business. In 2007 he has started the www.biz-development.com web site dedicated to development of managerial skills. He also runs www.my-introspective.com a Personal Exploration and Development Guide.

Is it Worthwhile to Set Up a Merchant Account?

People in online business want to be able to quickly process their online payments. They also want to appear professional and secure for their clients otherwise people won’t be confident enough to trust them. For this reason, it’s often wise to set up a merchant account quickly. There are a lot of reasons to get a merchant account including:

- You can increase your customer base by demonstrating professionalism with a professional looking online payment solution

- You’ll have the ability to accept major credit cards such as Visa, MasterCard, Amex and Discover payments on a secure connection right from your website. Your customers need to feel secure in buying from you!

- You could get the ability to rent a terminal for credit card payments that need to be processed manually. The terminals are often included with your monthly membership fee and this can save you a several hundred dollar expense. This can help you with online and offline business.

- Have your online payments transferred to you by wire securely, quickly and safely.

- Included software enabling you to set up price lists and shopping carts on your website

- Transaction reporting and statements making your bookkeeping management much more seamless

- Fraud screening protection. A lot of online retailers have been the victims of credit card chargeback fraud where someone buys something from a site and then claims fraud later so that you are automatically deducted money but still out of pocket for the product provided. A merchant account could help you avoid this problem with fraud screening services included in the cost of having the account.

- Low fees. Compared to some services such as PayPal, a merchant account has much lower fees that enable you to have greater profit margin. While some have monthly fees, the low transaction cost and value added services can make the fees negligible in contrast to PayPal.

- 24/7 support is included in some cases which can help you with payment gateway problems that could happen. An open source program won’t offer you any help so a merchant solution could be a better alternative, especially if you have (or want to expand to) a borderless business with many customers ordering in various time zones. If you’re looking at several options, you’ll want to take the amount of included support into serious consideration!

- Speaking of borderless businesses, a solid merchant service will give you the ability to accept payments in multiple currencies which can extend your ability to service more customers.

How do you set up a merchant account?

There are a lot of companies to choose from when you get ready to embark on finding a suitable merchant services company. Once you’ve done your due diligence and found someone suitable, you’ll likely have to provide completed paperwork and an application form. Many high end merchant accounts now work to approve applicants quickly.

The account approval process will likely include request for a financial statement, banking information, a signed merchant agreement and copies of your photo ID.

Merchant accounts can be set up and software can typically be easily integrated into your existing website.

Looking at merchant account options? It might be time for you to set up a merchant account for your online business. Visit TheWebReviewer for a vast amount of free information and online product reviews pertaining to online payments and making money online.

EFT For Business Growth

Emotional Freedom Technique (EFT) has been referred to as a revolutionary method of psychological therapy that allows a person to take personal responsibility in improving his current life situation. It is said to give you the power to eliminate fear, trauma and stress and other negative emotions from your daily routine without resorting to surgery or other extensive medical procedures. Due in large part to the fact that it does not involve any surgical procedure, pill intake or needle-pricking –hence minimizing negative side effects — as well as to its one-size-fits-all appeal, EFT is now being promoted for use in all aspects of an average individual’s life.

Among the things we consider most important towards achieving personal satisfaction and fulfillment is professional development or success in business. And this part of our life has not escaped the notice of EFT enthusiasts around the world. They believe that the Emotional Freedom Techniques originally devised by Gary Craig can spell the big difference between being a business washout or an economic genius.

Taking into consideration the fact that Craig’s intention in developing EFT was to help people remove stress and cope with anxiety disorders, we have to concede that they could be right. For how can one be successful in business if he lives in a constant state of emotional stress? And how can one move forward in the business world if all his best intentions and ideas are overshadowed by an inherent fear of rejection and failure?

By employing the Emotional Freedom Techniques, we are able to slowly let go of all the negative feelings and memories that have burdened us all these years. In a way, we are making our personal “Declaration of Independence” — independence from stress, from fear, from envy, from anything and everything that hinders us from reaching our full potential as individuals. As a result of this independence, we become more positive in our outlook; thus allowing wealth, success and well-being to flow freely into our lives.

As you begin to make the technique a habit, you will notice its effects in subtle changes in your character. You begin to relax a bit while preparing for an important business presentation and become more confident in public speaking engagements. After a while, other people will see these changes as well and they will realize that you have become less irritable — generally, you shout less and smile more often. And because EFT does not only address money-making issues, but is primarily geared towards creating balance and total development in the individual, you get the bonus of feeling good and looking better than you have looked for years.

What’s best is that this method enables us to use our own healing energies in the privacy of our own home to relieve ourselves of psychological and emotional burdens. We do not have to go through the embarrassment of having to share our failures with others, as in an AA-type therapy session. Nor do we have to make a nuisance of ourselves by having to consult a professional every once in a while just to complain about imaginary aches and pains. EFT has, indeed, given us the chance to take matters into our own hands and take the necessary steps towards turning our business failures into shining success stories.

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Customer Focus is a Strategic Choice

The road to Customer Focus Land is paved with great intentions. As the CMC/HRI Magnifying Customer Focus survey indicates, respondents know what needs to be done. They are fully aware of the need for executive sponsorship, ongoing contact with customers and fast complaint resolution. But somehow, due to lack of time, budget or resources, the required actions are not executed at all or are not executed to the extent that they should be. The importance of the customer and the need to become a customer-centric organization is not disputed. The serious challenge is in the execution.

The Missing Ingredient

Why is it that these seemingly self-evident actions do not reach full execution? Why is it that despite a clear awareness of what needs to be done, companies aren’t making it happen? Why is it that despite their constant rhetoric about the need to become customer focused, companies do not actually execute?

The problem lies in one critical step that most executives and organizations skip or are not even aware of. At the core of the failure to become customer centric is the lack of a strategic choice to become a customer-centric organization. Most organizations treat customer centricity as an incremental shift where they merely add icing to the current strategic cake. It is perceived as a matter of simply smiling nicely and adjusting the overall attitude of the employees. A few T-shirts and motivational posters will do the trick. In reality, most companies require a more fundamental effort to become truly customer centric. They need to make a strategic choice.

The essence of strategic choice is accepting the need to make trade-offs. By making a choice to turn right, you make a choice not to turn left. Without trade-offs, the decision is not strategic and therefore is unlikely to be fully implemented and deliver meaningful results. Most organizations were built on a model of product or service centricity. These products and services were at the core of their businesses, and their ecosystems focused on managing the products and selling the same product to as many customers as possible, regardless of how different those customers were. The product-centric model was run on an efficiency methodology where one size fits all. The different ways customers interacted with the products or services were of little concern to the organization. Its main objective was to maximize its own revenues.

A Different Approach

A customer-focused approach runs the opposite course. It is fully focused on the customers and is geared to maximize revenues from customers rather than products. A customer-focused strategy delivers different services to different customers based on how unique the customers are. While product-centric organizations focus on selling the same products to as many customers as possible, customer-centric organizations focus on selling more products to the same customers. At the core of the customer-centric strategy is not efficiency but growth. The difference between the two strategies is the originthe product versus the customer. Do we start with a product and find as many customers as we can for it? Or, do we start with the customers needs and find as many solutions as we can for that customer? This difference is not merely semantics. It is rooted in a different definition of value proposition, a different organizational structure, a different pricing model and different methods of connecting with the customers. Customer-centric companies do things completely differently and not marginally differently, as is the case with product-centric companies.

Take a Stand

The overall results indicated in the CMC/HRI survey illustrate a nonstrategic approach to customer focus. Although respondents know what needs to be done, the results indicate that many organizations have not taken the stand to choose the strategic approach and make the leap.

Lip-service advertising about loving the customers and excessive customer surveys without meaningful change as follow-up are the wrong ways to approach customer centricity. These might be easy to implement, but they are not going to make your organization customer-centric. Such hollow efforts raise customers expectations without delivering anything tangible in terms of an improved customer experience. The economics of customer relationships are quite potent and the financial justifications for making the leap to customer centricity quite powerful. To support making that leap, executives need to benchmark and assess the costs and financial benefits of becoming customer centric (as opposed to remaining product/service centric) and then prepare to make the strategic decision.

The road to customer focus is paved with great intentions. But only those who have made the strategic choice, fully recognizing and accepting the trade-offs, will be able to embrace the new strategic direction and maximize its financial potential.

Management Career Training Centre provides professional development, motivational seminar, management and sales training, leadership and executive training programs for HR professionals, supervisors and employers.

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