“Reduced spending by consumers and businesses expected through 2010”… “Household wealth falls by trillions”.. “Another increase in jobless claims”. These are the business headlines of today. They can strike fear in our hearts – we the executives and business owners, managers and entrepreneurs that are trying to succeed in this economy or they can be used to fuel the fire that put us in this seat in the first place. The key is understanding the levers available to our business, creating a strong plan, and driving it forward fearlessly.
Are you playing to win… or playing not to lose?
I recently read an excellent Harvard Business digital article by James Allen and Darrell Rigby entitled “Winning in Turbulence: Clarify strategy: choose where and how to win.“ In this piece written for CEOs and business owners, the authors state:
“The goal of strategy in a downturn is to help you end up on the right side of the mortality tables-not just surviving but poised for growth, as Darwinian forces eliminate weaker competitors. To build that strategy, you need to know exactly where you will compete, how you plan to win and how you will mobilize the organization to implement the strategy.“
To adopt this viewpoint is to move from a space of fear and indecision to one of control and ascendancy. When a competitor fails, you must be ready to win over their customers and take over the relationships. You must also understand which of them are going to be profitable and add to your growth, and which you should avoid. But how do I look ahead and think big when my sales are down, even some of my best customers are paying me later than ever and my operating costs are at best, flat?
Start here:
1. Connect with your best existing customers and take the time to re-evaluate why they continue to choose your company over the competition. Talk to them – ask them to explain why they are loyal to your solution despite the choices available to them. They will appreciate your interest in them and your connection will be strengthened. You might be surprised at what you hear. Very often we lose sight of the core reasons we are selected above other alternatives, and reinforcing the message around these core strengths is what will help you win business from the competition.
2. Get a fresh perspective of your website and see if your messaging mirrors what your customers told you mattered. I have witnessed firsthand how easy it is to shift your focus too far away from this core and burn cash trying too many new ideas in the desire to create growth in a downturn. This shift may create confusion for both existing customers and new prospects trying to understand how you bring value to their business as well as make it a challenge for your sales team to figure out what they should be selling.
3. Take a hard, impartial look at the financial situation of your existing customer base and all new prospects. Arguably few companies are immune from the credit and market dynamics at play right now and some may be using you as a means of funding their operations. I am not suggesting you ask them if they are struggling, but ask them what’s working for them and what is not as a fellow business owner and leader. How they answer you will explain quite a lot. There are also many valuable credit risk management tools both free and for a fee available to get an objective look at their current financial situation. How are they paying other vendors and partners? Are there any tax issues or recent litigation filed against their business? Are their customers commenting and blogging negatively about them?
4. Profile and score your prospects as a part of your marketing program. Your sales team shouldn’t be worried about the credit worthiness and financial issues affecting a prospect – their job is to fill the pipeline with buyers. You also need an equally robust credit approval process that sets smart terms for payment and protects the cash flow of your business. Remember, you would be better off not making the sale then booking it and writing it off 180 or 270 days from now, and your reps understand the pain of a chargeback – make it easy for them to succeed.
I have used this pragmatic mix of focusing on the core value prop, communicating it effectively to the right qualified targets and integrating a strong credit policy while working with many businesses from the Fortune 50 to my own small businesses. If you are ready to “play to win” and acquire new customers, then you have just taken back control in these turbulent times.
Have you found something that helps you play to win? Please drop a note in the comments, I would love to hear about your experiences. – GK