Create Value Innovation

Check out my OTHER blog - named one of the Top 100 Leadership Blogs!

I am honored that my other blog, Innovate Rotary!, was named one of the Top 100 Leadership Blogs!  It's nice to be recognized on the same list as Seth Godin, Tom Peters and many other insightful thought leaders.

Innovate Rotary! focuses on creating thriving, growing nonprofit organizations, with a particular focus on Rotary International.  In the spirit of Blue Ocean Strategy, it is about helping people rethink their assumptions about community service by creating more impact for less effort.

So, check it out here!  And if you like what's happening here at Create Value Innovation, be sure to bookmark it as a favorite!

Salespeople are Change Agents

I am frequently asked by sales leaders to help their people handle objections more effectively.  This triggers a discussion about what kinds of objections their salespeople are facing, what might be triggering those objections and how they are currently addressing what turn into crucial conversations.

Most often, especially in large-ticket sales, I find that objections are created because salespeople simply ask customers to accept too much change, for the expected benefit or risk involved for the customer:

• Too big a change in routine for the customer, whether users, buyers or influencers
• Too much effort to evaluate the offer
• Too much time or effort to deal with the product
• Too much time or effort to deal with the supplier
• Too much change for the customer's organization to handle!
• Too much risk to implement, change behavior or to see impact

Numerous studies show that more than 70% of change initiatives fail.  Given that, why should salespeople expect that, as outsiders, that they can convince the customer to take the risk to change, let alone be successful in executing it?

When salespeople recognize that their success requires others to change behavior, they get a new perspective on selling and a fresh perspective on what they see as "objections."  Successful salespeople are change agents.  Unfortunately, people and organizations do not like change.   This is not to say that people are intentionally stubborn.  Saying "no" is simply one way that people cope with change.  When things get busy, people protect their routines and rituals.  Customer resistance often starts when salespeople carelessly consume customer time and ask customers to change their rituals without fair reward.

For example, when working with Rotary Club leaders on membership development, this thinking creates a shift in their conversation with potential new members.  Instead of just asking and asking (the sales training cliche equivalent of "close six times"), the club leaders focus much more on making their mission and impact clear to members, while making it very clear how they will help new members integrate into the club.  Why should anyone join a nonprofit and spend less time with their families, their hobbies, their work or any other volunteer activity?

When customers say "no!" they are just saying that they will not change their behavior.  So what can salespeople do about objections?  Prevent objections.  Don't deal with objections.  Start by looking at reducing the customer time and effort required to deal with you your organization:

1. Reduce their work.  How can you make it easier for customers to buy, implement, learn and use your products and services?  Have you communicated how simple it will be for them?  What can you do to reduce their work, whether it is directly related to your product or not?
2. Streamline the working relationship.  Customers develop a working rhythm with suppliers, whether they love them or not.  Why should they interrupt that rhythm to work with you?
3. Help customers connect.  One of the consequences of "too much work" is that people become disconnected from their own organizations.  Recently, getting sales to work more effectively with marketing is a hot topic.  What can you as a supplier to to help your customers connect?
4. Simplify your communication.  Bill Jensen has distilled the essence of change management into three simple ideas - Know - Feel - Do.  What do you want them to know?  How do you want them to feel?  What do you want them to do?

When salespeople realize they are change agents, I have noticed that they begin to shift their approach.  They use customer time more carefully.  They think through their actions and how their recommendations affect their customers - both in terms of results promised and in terms of the work needed to realize those results. 

Many salespeople are excited to tell me that their customers respond immediately - and positively when they make this shift in thinking.  Rather than try to do everything for the customer, why not help them do a few things really well, and make it easier for them to do their work - and in less time? 

• How have you simplified your products or your working relationship to make it easier for your customers to drive value from what you offer?
• Of all of the suppliers in your category, what can you do to be the easiest to do business with? 

Drucker on Innovation

"Innovation can be defined as the task of endowing human and material resources with new and greater wealth-producing capacity."

". . . every managerial unit of a business should have responsibility for innovation and definite innovation goals.  It should be responsible for contributing to innovation in the company's product or service; in addition, it should strive consciously to advance the art in the particular area in which it is engaged"

"Managers must convert society's needs into opportunities for profitable business."

" Peter Drucker, Management:  Tasks, Responsibilities, Practices, 1973, page 67

Reviewing Drucker's work, I am struck by the continuing relevance of his comments, more than 10 years before he published Innovation and Entrepreneurship.

How I Wasted My Tuesday Morning

To become better at anticipating, at innovating, we cannot be surprised by new ideas.  We have to maintain this simultaneous wonder at what is new, without being awestruck by it.  Knowing about change, seeing it, recognizing the new idea, while wishing we were part of it, and then reflecting on it - getting in the way of innovation:  all of this makes us better innovators, salespeople and leaders.

This past Tuesday, The Masters Forum featured Reinier Evers, founder of trendwatching.com.

Among other things, Reinier discussed an emerging trend he calls, STATUS SKILLS:

"In economies that increasingly depend on (and thus value) creative thinking and acting, well-known status symbols tied to owning and consuming goods and services will find worthy competition from 'STATUS SKILLS': those skills that consumers are mastering to make the most of those same goods and services, bringing them status by being good at something, and the story telling that comes with it."

What next?  I think those new stories will require either a willing audience or some assistance for the storytellers.  A resort either has to trust that the guest will tell the story well or help the guest to craft a compelling tale.  The cooking school might suggest some ways to tie in stories about the farmers who grow the produce or the wine makers who enhanced the experience.  Perhaps the resort that writes postcards on behalf guests is going too far.  A story is best told by the person who directly engages in the experience. But for the benefit of the family and friends back home, perhaps a short course in effective storytelling would enhance the experience all around.

The world can always use great storytellers!

Associations - Time to Innovate?

I came across an interesting discussion about innovation on the Acronym weblog (serving the association management community).  It seems that most of the commenters were in favor of innovation, but were struggling to arrive at a consistent innovation process, let alone a useful definition of innovation. 

The good news for associations is that you are not alone - publicly-traded companies often find innovation to be equally challenging.

Any great organization, to stay great, must periodically evaluate whether it is serving its purpose and its customers.  When it discovers it is no longer serving its mission, it must make the necessary corrections and follow through. 

First, let's get clear what we mean about innovation.  Here are a couple of definitions discussed in the posting:

• intersection between invention and insight (Mike Rhodin of IBM)
• the way a product is executed to enable differentiation (Mike Steen)

Value Innovation, as developed in Blue Ocean Strategy, refers to creating leaps in value for the customer, and thereby, opening up uncontested market space. 

"Value Innovation occurs only when companies align innovation with utility, price and cost positions." 

Often, we can reduce or eliminate some of the things we do that used to be required by members, but now are no longer needed.  Many associations and non-profits would find this to be true if they engaged with their members, and more importantly, former members and the people who refuse to join.

Associations' historical strength is their ability to bring people and ideas together. That value proposition is challenged as people are increasingly starved for both time and significance, and as ideas multiply and circulate more freely.  The value to members is not less because the association is executing poorly, but because pure execution on an outdated model no longer delivers the connection and the significance that is now needed by the members. This is a screaming call for innovation!

Any exceptional organization must wrestle with maintaining its relevance to customers, whether nonprofit, association or public corporation.

The issue is not whether an association should or should not innovate, re-engineer, right-size or implement any other hot concept. The focus is not, as Jim Collins suggests, on drawing in ideas from the business sector, as there are plenty of mediocre businesses. The real issue is this how to focus on disciplined thought and disciplined action to create a truly great organization.

Organizations can revitalize themselves by taking a fresh look across various paths to innovation.  To reduce risk and conserve resources, innovation must take place using a systematic discipline.  Part of the discipline is to revisit the value curves on your strategy canvas to see when your value curve converges with that of your competition.  And for membership-based organizations, two of the biggest competitors are time and significance. 

Why should anyone want to join your organization anyway?  Do they come to meetings and conferences because they would be conspicuous by not being there?  Or do they engage with boundless energy because they cannot believe the incredible juice they get from being involved?

What do you think?

• Can you think of any associations or non profits that are suffering because they refused to revisit their business strategy and the value they offer to customers?  What's happening?
• One of the challenges to implementing change is dealing with risk.  What approaches have you observed that helped an organization manage the risk aspects of its innovation efforts?

Nonprofits - New role as connector

Branding Evangelist Jennifer Rice expressed her frustration (see Adventure Divas) about the disappointing contrast between her excitement and anticipation to get involved in a worthwhile service opportunity and the reality of the organization's flat web presence in keeping her excited.

For nonprofits and volunteer service organizations, it points out a specific opportunity to rethink the functional-emotional appeal (and perhaps reach across strategic groups) to reach potential volunteers.  Don't get them to join, help connect them to what they are passionate about! 

In other words, too many service organizations try to recruit new members by focusing on things like networking, prestige, connecting with the community, giving back, etc.  Gee, why would I spend less time with my family, my work, my hobbies, my 5 other volunteer commitments - or my weblogs to spend more time with your organization?

What potential volunteers are looking for, however, is SIGNIFICANCE.   The competition is not between the Lions, the Rotary and the Optimists.  The competition is between any of those choices and whatever experience they could otherwise get from their time.

How fast can we get volunteers to say "WOW" with tears of joy in their eyes - and keep renewing that excitement?

So volunteer organizations can do at least 2 things:

• shape the experience to help them connect with what they are passionate about
• target those groups who have unmet dreams of service in an area you can fulfill and make it easy for them to get engaged.

When you connect people with what they are passionate about, they find the time and energy to pursue it.

By the way, if you are looking for a way to get involved in some amazing projects worldwide, contact me about Rotary.  For information about making a difference to women and children who have been affected by poverty and war, check out Fifty Lanterns.

• If you take the view that employees are volunteers, which companies do a great job of connecting people to what they are passionate about?
• Which nonprofits offer a consistently great experience for potential volunteers and donors?