Jeff Standridge (Intro):
Are you ready to change the trajectory of your business and see massive improvements? Each week, we’ll share strategies and practices to generate sustained results and long-lasting success in your organization. Welcome to the Innovation Junkies Podcast.
Jeff Standridge:
Hey guys, Welcome to another episode of the Innovation Junkies Podcast. I’m Jeff Standridge.
Jeff Amerine:
Hey, this is Jeff Amerine. Glad to be back.
Jeff Standridge:
Hey, man. Really excited about what we’re talking about today because organizations, a lot of times, can be really fuzzy in terms of what’s actually going on behind the curtain, so to speak. Today, we’re going to give you five questions that you, as a leader, should be asking about how your business operates.
Jeff Amerine:
Yeah. These are crucially important too. They say that any business rises and falls with sales. Sales are all about understanding your customer. Let’s talk a little bit more about that, Jeff.
Jeff Standridge:
Yeah. One of the very first questions that you need to ask as a leader is how do we acquire a customer? Oh, by the way, we’re not just asking these questions. We’re asking if the organization knows it and if there’s a core critical business process documented around these five questions. That’s really what we’re trying to get at here… is core business processes. Are they documented? Here’s some of the questions that we should ask to get to that, as you said, about the customer. How do we acquire a new customer? Who are our customers? Who are our ideal customers? How do we go about getting them? Is it primarily a marketing-driven activity? Is it primarily inbound that we respond to them? Or do we have an outbound sales force, and that’s where 80 or 90 or 100% of them come from? How do we actually acquire a customer, and what do we spend in terms of acquiring that customer? That’s a critical business process we have to have a handle on.
Jeff Amerine:
Yeah. I’ll tell you what, more businesses of all sizes tend to fail if they’re launching a new product line or a new service line, not understanding that it’s not personal heroics or just a miraculous sales guy. I think Aaron Ross in Predictable Revenue… and the other one he wrote was from Impossible to Inevitable, does a great job templating out that whole process, the number of required touchpoints, and how to divide the process between sales development reps and closers, the BDRs. Just systematizing all that is so important because if you can’t sell and you don’t know how to rationally acquire customers, that is a quick path to going out of business. Crucially important.
Jeff Standridge:
Absolutely. Absolutely. The second one is once you get a customer, how do you onboard them? How do you bring them into the organization so that they have the greatest opportunity for success with your product or service, they know how to fully leverage your product or service, and they know whom to call when they have an issue with your product or service? How do you acquire, and then how do you actually usher them into your organization, which we call onboarding?
Jeff Amerine:
Yeah. I’ll give you a somewhat, maybe a negative example. I was having some construction work done on a property that I have. I’m having new fences and new gates installed. The thing that was interesting was… very engaging initial process. They gave me the proposal. Laid out a timeline. I’m excited. I paid the money upfront. In three to six months, I don’t hear anything from them. I don’t know if they’ve disappeared, if they’ve left the country, or what.
Then, I get this random system-generated email that says, “Your implementation team will be out on such and such states.” I’m excited. “Wow! They’ve even got an automated system.” Those dates come up, and they don’t show up. They don’t call me. They don’t let me know that they’re coming. I’m thinking, “These guys are scam artists. I’ve just given them a whole slug of money to do something, and they’re not going to show up.” Calls, calls, calls to the leads. They eventually respond. “Oh, we’re sorry.” They’ve got an automated system that is supposed to be telling me how I’m going to be onboarded and how it’s all going to work. At that second really crucial moment of truth, I’ve lost all confidence in them. I wonder if I’ve made a mistake with selecting them as a partner/as a vendor. At that point, I’m thinking, “I’m going to have to manage this a whole lot more closely than I’d hoped.”
Jeff Standridge:
Depending on the level of ticket item that you’re selling in terms of a product or a service, a best practice there is really to just have a kickoff call and to have a next-step sheet. “Here’s what you can expect when you join our organization. We’re going to have a kickoff call. In that kickoff call, we’re going to talk through… Okay, here’s what happens. First, second, third. Here’s the information that we need from you. When we get that information, here’s how we’re going to turn that around. Here’s how we’re going to get you set up on our system or with our product or service.” They could have very easily explained to you… “Here’s what to expect. Now that you’ve given us your check and you’ve signed the contract, you’re going to receive this in about five days, this in about 14 days. We’re going to be doing work on this,” et cetera. One of the reasons I would even say that organizations don’t write that stuff down is because then they know they’ve got to be held accountable to it.
Jeff Amerine:
It is a sad commentary. It’s so important to set those expectations. It sounds trite or cliche but to underpromise and then overdeliver. Nobody ever fired, a supplier or a partner, a vendor for missing a deadline so long as they communicated. I think the key thing is making sure that that customer has information. I have the comfort of knowing if issues come up, and they inevitably do, you’re going to tell me that those issues have come out, and not 10 seconds before I’m expecting you to show up. But the day before/the week before, they’re going to say, “Hey, we’ve hit a delay. We’ve got this issue.” Just makes all the difference. It conveys a level of professionalism to that organization that is going to get those customers to come back in the future, even if there are problems.
Jeff Standridge:
How some of these companies, particularly home service type companies, whether it’s cable or electric or telephone or whatever… I guess we don’t do telephone much anymore. But what these home service companies do is they’ll say, “We’ll be there between 8:00 and 4:00 on this day or this day.”
Jeff Amerine:
Exactly. What does that-
Jeff Standridge:
“Okay. I’ll need to take two days’ vacation.”
Jeff Amerine:
Well, just imagine that. Imagine that if we did that with some of our clients. It’s like, “No, we might have your executive coaching kickoff between 9:00 to 5:00 on one of these three days.” It’s like a big mystery. It’s like nobody can live like that. Yet, there’s some segments where that’s tolerated, and it just doesn’t make any sense. I’ll tell you what, not to pick on skilled trades or construction too much, but I think it’s illustrative. Those companies that we see that are having outsized growth are those companies that have professionalized their approach to customer engagement, to customer management, to communication where there’s not guesswork. Then, you’re like, “I don’t care. I’ll pay a little more, or I’ll pay the same. But I know that I can count on them.” It’s so true. It’s true in any business, really.
Jeff Standridge:
That’s right. We’ve talked about the front end here. How do you acquire a customer? How do you onboard a new customer? Then, the other question you really need to ask around a critical business process is, how does your organization deliver value to those customers? How do you actually deliver your product or service in a manner that creates the highest degree of value from the customer’s perspective?
Jeff Amerine:
Yeah. Now, we’ll shift gears a little bit and talk about the technology-sell. All too often, particularly prior to the dotcom bust, people were acquiring technology for the sake of technology because they hoped everybody else was doing it, and they hoped it was going to generate value. Now, in a business-to-business sale, by and large, people are going to be interested in a couple of things. Is this going to increase revenues, or is this going to decrease cost? If you can’t demonstrate that value justification as part of the sales process, and then with realized gains or realized cost reductions, you’re probably not going to keep that account. That value justification is crucially important. Understanding how you do that and how those numbers work… It will keep the deals sold with the CFO and with the profit and loss executives in that company.
Jeff Standridge:
Completely agree. Completely agree. We talked about this in a previous discussion, or we touched on it. But how do you make decisions? That’s the fourth one that we’re looking at here. How do you make decisions in the core operations of your business? We shared a little bit about that. But talk a little more if you would on that.
Jeff Amerine:
Yeah. I think it’s important. People that are in that decision-making chain of command… Understanding their limits of authority and understanding when they’re empowered to make a decision based on that limit of authority and when they have to push it to the next level… I think that’s critically important. Having those guidelines established will keep bad things from happening.
I’ll give you an example. Absent a limit of authority established, when I was in an executive position, I always operated under “unless directed otherwise” because I was going to do something. I was going to take action. When there’s uncertainty about the limit of authority… If you have someone that’s entrepreneurial and confident, they’re going to take action without consultation. It is important to provide clarity. “This is your limit of authority. This is the understanding.” That clarity is not a bureaucracy. That clarity provides clearance for somebody that is confident and empowered to go ahead and do something you want to do. Decentralized execution works well when there’s clarity of understanding of the limit of authority.
Jeff Standridge:
I learned that at a very early age when I was recruited out of my academic career and into an actual publicly traded company. I was there to perform a very specialized job almost as an internal consultant in the organization. The executive that hired me was leading a 400 million organization. She couldn’t meet with me on a regular basis. She couldn’t meet with me weekly and really be directly involved in what I was doing. I just shot her a note one day, and I said, “Hey, look.” I shot her the note, and then we had a face-to-face about it.” I said, “Look, I know what I need to do in the organization. I’m going to keep you abreast of what I’m doing with a weekly email that says, ‘This is what I’ve done, and this is where I’m headed.’ If you see any red flags, you better raise your hand because if you wait two or three days to raise your hand, it may be too late because I’m going to be operating on a ‘unless directed otherwise’ or asking for forgiveness versus permission.”
There were a couple of times when she raised her hand a couple of days later. Here, I was a 26/27-year-old. I was wet behind the ears. I was moving… What do they say? High speed, low drag. She had to come and say, “Hey, I think we probably went a little far down this path. We probably need to redirect here.” That was great. But I will tell you. Together we got more done in the organization than we would have otherwise.
Jeff Amerine:
Well, and you want that. I’ll tell you what. You want that as you think about how to lead if you’re a young leader. You want to empower people with that frame. You can only do that if you’re not afraid for your own career. First of all, you’ve given them the tools they need. You’ve hired the right people. You empower them to make a decision. You want them to feel like they are not just a cog but somebody that can actually take action. You can’t be afraid that occasionally they might make a mistake. If they do, you’re going to take it on the backside, not them. Your job is going to be to take the blame when things go poorly and pass along the credit when things go well. If you do that on a regular basis, you’re not afraid to have your key people that work for you make decisions.
Jeff Standridge:
That’s right. What we’re talking about here is the five questions to ask about how your business operates. How do you acquire new customers? How do you onboard new customers? How do you deliver value to those customers with your products and services? How do you make decisions? Then, we’ve just finished talking about… How do you steer the ship, or how do you lead your people as they go about creating value for your customers? Great episode, Jeff.
Jeff Amerine:
Yeah, thanks. The art and science of leadership. It can be learned.
Jeff Standridge:
That’s right. This has been another episode of the Innovation Junkies podcast. Thank you for joining.
Jeff Amerine:
See you next time.
Jeff Amerine (Outro):
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