The Service Was Seen As A Commodity

By Kari Foster

Danger appears when business development is slower. That's when risks arise. 2 years is a long time in business, and 5 years seems like an eternity. If the pace of change is one where significant change can only be seen in 2 or more years, you need to make a conscious effort to expand your thinking.

• Language: English
• Publisher: Kari Foster
• Release date: May 5, 2024
• ISBN: 9798869360663

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The Service Was Seen As A Commodity

The Service Was Seen As A Commodity

Copyright © 2023 by Kari Foster

All rights reserved

TABLE OF CONTENTS

CHAPTER 1 : DON'T TURN A HEALTHY PIG INTO A LAME PIG

CHAPTER 2 : CHALLENGES TO YOUR PERSONALITY

CHAPTER 3 : TO RUSSIA AND BACK

CHAPTER 4 : EVALUATE THE POTENTIAL CONTACT'S ONLINE PRESENCE

CHAPTER 5 : IDEAL WORKING ENVIRONMENT

CHAPTER 1 : DON'T TURN A HEALTHY PIG INTO A LAME PIG

Usually this is a bad idea, if it is applied to important things. Even when things are working well, somewhere there is someone trying to ruin it. Big companies make sure they never forget this. Look at the two companies that have made the most money over the longest periods of time in the computer business: Intel and Microsoft . As I mentioned, Andy Grove, when he was chairman of Intel Corporation, observed that Only the paranoid survive. Kevin Turner, CEO of Microsoft Corporation, recently described the healthy level of uncertainty that drives rapid innovation at Microsoft Corporation. Microsoft's PC operating systems business is still doing well - at the time I write this book they are shipping large quantities of Windows 7 software - but Microsoft has struggled to grow its presence in the industry. cloud computing - this field could eventually wipe out traditional Windows systems.

Even if no one is trying to disrupt your product or service, everything still has its own natural life. It looks like an S-shaped curve:

Every product, job or company starts out small, then grows to maturity, and then begins to decline. This is extremely obvious in some professions. For example, at Intel Corporation, 90% of December's income came from products that were not delivered in January. The inevitable result was that 90% of their income in January came from frozen products. at the end of the year. Also at this corporation, they have no illusions about this issue - the current business line needs to be reinvented every year.

Danger appears when business development is slower. That's when risks arise. 2 years is a long time in business, and 5 years seems like an eternity. If the pace of change is one where significant change can only be seen in 2 or more years, you need to make a conscious effort to expand your thinking.

Look far enough, and you will notice that everything you and your predecessors have done before has frozen in the present moment. Then look forward - everything you're doing now will freeze in the future. The question is, do you wait until it's gone, or do you move on to the next thing while your current business is still going well? If I have to build a new business, I will do so while my current business is growing well, money is abundant and confidence is overflowing.

Essentially, the principle of don't turn a good pig into a lame pig is a recipe for complacency, for keeping a moderate level of stability, instead of better, better. We've been reminded a lot lately that times can change, and what was moderately good can quickly become not so good at all. Until 2008, we had a long period of economic development, and that development had many potential risks. The recession has made this obvious to many people. If you care about longevity in your business, remember moderately good is not good enough.

So what is the antidote? Maybe you see yourself, or someone else, saying the adage Don't turn a good pig into a lame pig and at that moment, you know you need to stop and think to make sure the statement still makes sense. Most of the time, though, you don't find yourself thinking, If things were going well, I'd stay the same. This is a more dangerous situation. Here are two techniques to detect when things are about to break down, and whether you need to take action.

The first technique utilizes the invaluable S curve mentioned earlier. Put all activities, or all products and customers, on that curve. The correct arrangement looks like the image below:

There are a number of new products about to appear, ensuring the future. In the middle of the development phase, some products bring high profits. And there are products that fall into decline. It is possible that these products decrease in quantity, and this gives you the opportunity to make a very high profit at a time, by discontinuing those products. These products end soon, so you can take decisive action as the worst thing this does is speed up the process. You have enough money to be firm in pricing; Customers still using these soon-to-be-obsolete products are likely to stick with them, and many competitors no longer make them. You can then cut back on marketing for these end-of-life products. This will save money, and these products will not attract new customers. Almost all of these products have been canceled.

On the other hand, if the image looks like the one below, your problem is much more complicated.

Everything is in the final stages. There are no new products coming out, nor are there reliable customers to see you through the next few years. This is an urgency that doesn't feel like an urgent matter at all. Nothing has broken yet, but everything is about to fall apart.

I hope that, when you draw the S-curve in your business, it won't look like the second drawing. To ensure you never end up in that position, paint the picture as it was, and then plan for the next few years. Just simply move everything a few years into place and see what the picture looks like? Now you know what you need to do to ensure a future with new products or new customers.

If things aren't going well, don't fix it

There are plenty of reasons why fixing things that went wrong is a terrible idea (but here are some reasons why it is a good one, so be careful.) Before deciding to repair something, ask yourself one very important question. What would I do if I didn't take the time to try to fix this situation?

You can:

- Build something new.

- Increase work that is running effectively.

- Take preventive action to correct things that are at risk of not going well. (Maybe by the time you take the time to fix one thing, you can prevent three things from falling apart.)

You need to know that it can be fixed. Sometimes this is a problem with new products that aren't very effective. These products are not working, but were they effective in the past? Do they have any chance of being effective? If a project, or a product, we love dearly, it's easy to become obsessed with trying to make it work, even long after the time of an objective observer has passed. conclude that the product or project has no chance of delivering the same results anymore.

A common mistake is trying to fix things that used to work, but no longer work. Sometimes, trying harder seems like the easier option than thinking more deeply. Deeper thinking may reveal evidence that the world has changed, that business methods need to be changed, or that an entirely new method is needed. Sometimes, the accompanying pain is also psychological. If we have built an existing business, this may seem more like killing the future than reinvesting in ourselves.

I encountered one of these situations when I was a director of a marketing consulting firm. As I mentioned, our expertise is helping pharmaceutical companies create marketing messages for new products by leveraging their clinical data. In the early 1980s this was a radical idea, almost magical. No one knows how this method works, but everyone wants it. But by the late 1980s the mystery had disappeared, although it was still a premium service that commanded a fair fee. In the mid-1990s, mystical magic completely disappeared. The service was seen as a commodity, and the companies that provided it found themselves not providing a service to value-obsessed marketing executives, but instead selling to mass media agencies. Professional shopping managers only want the lowest price. At the same time, there were fewer new projects (pharmaceutical companies could not come up with new products) and the focus had to shift from the clinical communication phase (promoting physicians who did not know or were not interested in drug prices) to the pharmacological stage (convincing the economists and accountants who control drug prescription decisions that your product offers the best return on investment.)

With the benefit of hindsight, the conclusion is clear. The game is over. Either we have to reinvest like the pharmacological economic communication consultants, or we have to go out of business.

Of course that's not what we do. We redouble our efforts to do the things that have made us successful in the past. We work harder. We are recruiting more sales staff. What I mean is that we hire more sales people at more expensive salaries (their salaries are higher because all companies in this field are trying to increase their sales staff). . We make more phone calls. We boarded more flights. We invested more, with larger amounts of money - but got no results…

It's not just companies that make this mistake. Many countries make the same mistake. Think of Britain in the 1960s and 1970s. At that time, the country enjoyed a surplus of cash from North Sea oil reserves, but what did it use that money for? They tried their best to prop up the industries that had shined but were dying at the time: coal, shipbuilding, cars, steel - industries that had made the country rich, but At that time, it was impossible to help the country develop further. Obviously that solution doesn't work. No amount of government investment can save the situation. That money could only delay what was certain to happen, and make the industrial carnage of the early 1980s worse than ever. What would Britain be like today if it had invested all that subsidy money in the industries of the future?

So, how do you know it's time to cut back on unprofitable products and devote your efforts elsewhere?

Here are some tips to help you avoid getting fixated on failure:

- Accept the fix it once rule. If the job doesn't work, you're allowed to fix it. But if it still doesn't work, give up and move on.

- Think about opportunity costs. Let's determine the quantity. If you're struggling to fix something, look at the time and money you have to spend on it and write the best alternative for it. Does that solution look more appealing? If yes, then you should implement this workaround.

- Find the purpose of shrinking profits. This can be a good hint that something is broken beyond the point where it can be repaired profitably. For example, in the marketing consulting industry, the real suggestion is that our business efforts mean reduced profits. It takes more salespeople and more phone calls to generate the same number of opportunities to propose, and it takes a lot more investment to become trustworthy, never mind winning. win in business.

- Set clear milestones for success. When you start working on a project, you need to be clear both about success and the first signs of that success. Let's say success is selling 10,000 sets of products per month after three years. Three years is a long time to wait. Are there any shorter milestones for you? Maybe your goal is sell 1,000 product sets in 9 months or get adopted by six existing customers in just one year. It's hard to give up on a project that's failing miserably, but it's harder to give up something that's clearly leading to failure. Deciding clearly on success milestones in advance makes this easier.

- Try to minimize emotional investment. Peter Drucker correctly pointed out the weakness when he invested in products including the category investment in management consciousness. The last thing you want to do is end up with your sense, aka your credibility or reputation, tied to a failed project. There's a difficult balance here - you and others need an emotional investment in a project or it will never take off, but the investment is too big and you can be dazzled by reality.

Keep reminding yourself - ignore the long-term costs:

- Project A requires an investment of £1 million over the next year and will return a profit of £1.2 million.

- Project B requires an investment of £1 million next year and will yield a profit of £2 million.

Does it matter that £5 million has been invested in project A (before it turns a profit) while project B has not had any investment yet? No, it's not important, but it should be considered. Logic is inevitable, but psychology is even more difficult. Behavioral economists know that the value we attach to something depends greatly on what we pay for it, regardless of its future value.

Action scales now

This has shallow appeal, but its appeal rests on two universal pillars of Bad Ideas:

1.      Illusory way of thinking

2.      Elements that create a sense of comfort

There is a fascinating element of magic hidden in the idea that if we want to solve a problem, we can only take large-scale action. The thinking, the planning, the selection of appropriate tools, the analysis of possibilities and risks, the analysis of whether the result is worth the effort? Unnecessary.

It still makes us feel good. Action, especially if it is dramatic and difficult, is good.

The only problem is, this is the logic of World War I. Not winning this war? So just send more men and women to join the fight. Is the strategy effective? No, then just send more men and women to join the fight.

The answer is actually extremely simple. Just make sure you have a plan. Once you start taking action, stop every once in a while to check if the results are what you expected. If not, stop walking and change course of action.

Failure is not an option

If someone says that, what does it mean? If it just means failure is a very bad thing here, then it is just an obvious truth, but often when you hear this statement, there is something hidden in it. something else. Therein lies an element of fantasy thinking, an idea that we can choose a small number of projects and think that they cannot fail. That brings us back to the fairy tales and legends, where you have a magical flag to wave, or a magical whistle to blow and then you receive blessings. help. The problem is that you can only use that miracle once, or a maximum of three times.

Fantasy thinking is a wonderful way to think in fairy tales, but its effectiveness in the real world is unproven. In many ways, denying the possibility of failure can make failure more apparent.

- Create rigidity. We must stick to the plan, because modifying the plan means the plan could fail, and in this case, this is not an option. Ultimately, we fail at the very possibility of success, because success doesn't look like it should look like.

- Creates blindness. At work there are factors we cannot control such as competitors, changing technology, or changing customer needs. These factors can cause us to fail. If we cannot recognize the possibility of failure, then we cannot clearly see what is going on in these areas. We ignore reality until it is truly ingrained in us.

- Create an attitude of concealment and dishonesty. Many times, clients ask me to save projects that are failing, or have failed. Almost always, these projects failed sometime before senior management noticed the error. Project managers knew they were in trouble, but they wasted months trying to cover up the mistake.

It may seem paradoxical, but the best way to ensure certainty against failure is to accept that failure can happen. Avoid fantasy thinking, and stick to reality. So, there are some reasonable things you can do:

- Be vigilant for early warning signs.

- Be honest about the risks.

- Plan for alternative options.

- Cut losses sooner if things get bad.

- Realize alternative forms of success.

Just take action

This is a great slogan. It has sold billions of pounds of sports products for Nike. This slogan is also popular in the organizational world, and in that world it exemplifies the belief that with enough good will, courage and determination, anything is possible. A hasty