The Fuel of Innovation

Recently, I attended the annual ISBM Members Meeting at Penn State University. ISBM is short for the Institute for the Study of Business Markets and is a center of excellence in Penn State University's Smeal College of Business Administration. They are comprised of a global network of researchers, educators and day-to-day practitioners in the field of business-to-business marketing, and led by Executive Director Ralph Olivia. Their mission is to expand the research and teaching of business-to-business marketing and sales in academia and to improve the overall practice of business-to-business marketing and sales in the industry.
head cogs
This year's meeting was themed, "Reinventing Innovation: Driving Growth Beyond the Product" in Business Markets. Ralph and his team assembled an outstanding agenda that included speakers from Wesco, USG, Lord, and United Technologies to discuss innovation, value creation, driving growth, and best practices.  I was particularly intrigued, and energized by, the first keynote speaker Larry Keeley, President & Co-Founder of Doblin, Inc. (a Chicago-based think tank). Larry's discussion focused on INNOVATION FUNDAMENTALS (how innovation drives growth), which talked about the need and the process to driving organic growth. It was an outstanding (and highly entertaining) presentation, followed by many questions from the audience.

Larry's key take-away was that innovation is the key driver of growth. Companies that are able to simultaneously innovate across multiple "innovation types" will develop offerings that are more difficult to copy and that generate higher returns. Those innovation types can be grouped into a logical framework comprised of 4 key areas: Finance, Process, Offering, and Delivery. Within each key area, are the more detailed, structural drivers known as the "Ten Types of Innovation":

  1. Business Model
  2. Networking
  3. Enabling Process
  4. Core Process
  5. Product Performance
  6. Product System
  7. Service
  8. Channel
  9. Brand
  10. Customer Experience

Mr. Keeley provided detailed explanations along with excellent examples, to drive home his theme that these methods should be engrained in your culture to best position your organization to develop the next "Innovation Frontiers." The closing stressed three things organizations "must do":

  1. Systematically develop sophisticated offerings (using at least 6 of the 10 Types of Innovation)
  2. Identify "what's coming next" 
  3. Reinvent your enterprise so innovation is "not optional" - engraining these concepts into your cultural DNA

The second "must do" is by far the most challenging and the one many companies struggle with. Essentially, it is the fuel that will propel the vehicle. So how do you do this - and not just once, but consistently and iteratively? It's a tough task but, in my experience, the companies that excel in this area, are the companies that have a methodology and consistent process to gather, synthesize, and act on CUSTOMER INPUT.

You can have an outstanding business model, established processes, world-class product development, great channels, and strong brand but still miss the mark by a mile without customer input (can you say "New Coke"?!). Do you want to consistently create true market alignment with the most impact?

  • Leverage the voice of the customer
  • Obtain your customer's input EARLY AND OFTEN 

Your customers are on the cutting edge of their respective industries, and will gladly lead you to "what's coming next" - provided you ask. You'll also find that, as you deliver on their inputs, you will move up the value curve and become positioned as a trusted advisor.

I enthusiastically agree with Larry as he has described engraining the innovation types into your corporate culture. Additionally, you need to engrain the concept of regular customer dialog and input. So, how do we do this? What are the best ways to obtain customer input and feedback? There are numerous methods but you must start with the foundation that this WILL NOT be a one-time "event". It needs to be an on-going, committed conversation with your customers. Create a regular forum, along with a sense of "community" that includes internal resources and customers, and you will have the "fuel" to take your innovation vehicle and your company, anywhere you want!


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Too Bad Netflix Didn't Have a Customer Advisory Board!

I'm a Netflix subscriber, so, when I received my "personalized" email from Netflix CEO Reed Hastings on September 19, with the first line stating, "I messed up. I owe you an explanation," I thought to myself, "Too bad Netflix didn't have a Customer Advisory Board!" 
Netflix
Hastings said that he should have been more communicative about the changes and why the company was making them, which he said was that the two divisions were becoming very different businesses, and the company wanted each to grow independently. Enter "Qwikster".

Then, on October 10, I received my second "personalized" email, this time from The Netflix Team, informing me that it was clear that many Netflix members didn't care for the "two websites" idea, so they were going to keep Netflix as one place to go for streaming and DVDs - no change: one website, one account, one password ... in other words, no Qwikster.

Wow ... again I thought, if only Netflix had a Customer Advisory Board.  They could have avoided all of the above mess ...  they would have saved themselves much time, effort, embarrassment, lost revenue, and lost subscribers.  With a CAB, they would have proactively sought feedback and learned how the market would react to their "two separate websites" idea. Additionally, CAB members could have provided guidance on how best to communicate changes to their customers.  

A recent LA Times article stated that Netflix shares recently plummeted nearly 35% after it reported a loss of 800,000 U.S. customers in the third quarter. Even more troubling is that the defections have continued through October, leading Netflix to predict lower-than-expected growth through the end of 2012.

You would think it obvious that a price increase of up to 60% would not bode well with customers, but add to that the rebranding attempt of its DVD service, and you have a recipe for disaster. Still, had these ideas been vetted to a group of customers in an Advisory Board setting, there is no doubt Netflix would have heard the "voice of the customer" loud and clear and could have avoided the losses they have experienced.

Customer Advisory Boards have proven results for ROI.  Our clients not only see increased revenue from CAB member companies, but also receive guidance on how NOT to invest dollars in the WRONG places.  As an example, a new product in development was presented to members at a recent CAB meeting for feedback; it was "nixed" for being off-target and simply not a fit for the company.  That one recommendation alone saved our client $2 million.

Just think what a CAB could have done for Netflix ...
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How to Get Attendees Talking!

I realize I've written about this before - the importance of dialogue among attendees during meetings - but once again I've seen the positive results first hand.  I just returned from a very successful  Executive Summit.  What made it successful?

Attendees had the opportunity to have small group discussions on relevant topics.

You might think that's a "no-brainer" but you would be surprised at the number of leaders who think they should "present" at meetings.  They have much to say about their company and the great things they can do for customers and prospects, and often overlook the benefits of listening to what "the market" is saying - or the Voice Of The Customer.

People talkingBy "teeing up" the discussion and actively listening to the conversations among your customers and prospects, you will better understand the biggest issues they struggle with in their businesses.  It gives you important insight to develop more relevant solutions and, in turn, gives the attendees a chance to learn from one another and share what has worked for them, what hasn't worked, and why.

We find Peer Interaction to be one of the highest rated benefits of participating in Executive Summits and Customer Advisory Board meetings.  Don't make the mistake of dominating the discussions at your next meeting.  Be sure to include time for peer-to-peer dialogue and exchange.  You'll be viewed as a "listener" and you attendees will rate the meeting as a more valuable learning experience, worth their time. 
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Customer Advisory Boards Can Drive Strategic Planning - Part 1

In a recent HBR blog, Making Your Strategy More Relevant, Paul Leinwa and Cesare Mainardi suggest that “many business leaders seem to be losing their confidence in strategy, or at least in their own company’s approach to it.” In fact, in their ongoing Booz & Company survey, “53% of their respondents don’t feel their company’s strategy will lead to success.” I’m really not surprised.

Boring MeetingTraditional strategic planning seems to be a four-letter word these days. People I talk to dread it. From my own experience in a previous life, it’s a months-long tedious process of endless meetings and debates over which products and services are more likely to lead to success. More times than not, the end product is a tree of paper that sets on the shelves in executive offices until the process begins all over again in six months! 

The big question
How can the strategic planning process be improved?

The answer: Solicit your Customer Advisory Board members to help.

Let Customer Advisory Boards validate your Vision!

At a recent Customer Advisory Board meeting, my client shared their newly-drafted Vision Statement… to be the trusted provider that helps global clients do xyz. My client was shocked at what came next. He was already moving on to his next slide when a member in the back of the room spoke up. “Whoa! Wait a minute… go back to that slide!” Advisory Board members wanted to discuss that Vision Statement! Members wanted to know why their host company was being so modest. For the next twenty minutes or so, members asked questions and commented as follows.

  • Why are you limiting yourselves?
  • You are much more capable that you give yourselves credit for. 
  • We (some of us) already view you as a trusted partner. 
  • You’ve worked hard to earn our trust. 
  • You are much more than simply a service provider. 
  • The word “global” is in the wrong place. 
  • Your vision needs to be broader. 
  • You’re capable of being more than just a “partner to global clients.” 
  • You’re capable of being their “trusted global partner.” 

That’s a big difference. My client was pleasantly surprised. His Advisory Board members (his top customers) thought pretty highly of his company and wanted them to be successful. His Advisory Board members wanted them to strive for something bigger and better AND they believed they could do it!

Are you one of those business leaders who’s losing confidence in strategic planning? Perhaps you just need to change your approach to it. Solicit your Customer Advisory Board to help! You too may be pleasantly surprised. It could make a big difference! 

Look for Customer Advisory Boards Can Drive Strategic Planning - Part 2 coming soon!


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When Marketers Can Sound Like Charlie Brown’s Teacher

 

Charlie Brown and Snoopy contiplating life

"In the book of life, the answers aren't in the back."

~Charlie Brown


One of the things that I think is hilarious about Charlie Brown is the voices of all the adults (Teachers and Parents). When they speak, you can’t understand what they are saying. Now that’s great for a cartoon, but when you’re among your peers in other parts of the organization, it can be very frustrating.  This is a common complaint I hear from functional heads as well as Presidents and CEOs about the marketing department.

Let’s face it: Marketers invent words to describe things that could be expressed simply. The only group that invents more words than marketers are consultants. (Oh yes, we consultants have acronyms and buzz words for everything. Now that’s a self-inflicted wound.) While inventing and propagating novel phrases gives you street credibility in the marketing circles, industry and in the web 2.0 world, if you want to be taken seriously by your CEO and peers across the organization, markets need to speak in common-language business terminology.

Sound familiar: “We can drive share by leveraging our value proposition downstream to maximize our brand equity in the cloud. This will provide a boost in RSS and incentivized traffic and ultimately new logo acquisitions. We’ll supplement this all with virtual eZine programs. We can also engage power bloggers that follow netiquette protocols to boost our CTRs.”

I guarantee that most of the heads of sales, service, strategy, finance, IT, and development do not - and have no desire to - translate, interpret or decipher jargon like this. It’s like when you visit a foreign country. Everyone appreciates it when you make the effort to speak their language. The more you communicate in common business terminology, the more you’ll be accepted and respected by your peers and your boss.

Bottom line: The great thing about this last critical success factor is that it’s so simple to implement. Speak in a language that your colleagues and customers will understand and it will be easier to bring them on board with your initiatives. You’ll be in a much better position to have real and effective conversations.
 

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Think Your Customer Advisory Board Isn't Important? Think Again!

If you've fallen behind or gotten off track with your Customer Advisory Board (CAB) planning, and think you could put off a meeting because maybe "it's just not that important," think again!  Below are some comments from Advisory Board members who had mistakenly assumed their host company was canceling their upcoming CAB meeting:

"From my perspective, having key leaders and key customers together in one room to hear about the [host company] strategy and direction, and then having an opportunity to share our insights, is incredibly valuable."

"If [host company] doesn't continue the CAB, I vote we create our own group.  I'd certainly miss the [host company] engagement, but least it would give us the opportunity to share with each other.  I could hold the meeting at my company if people are willing to travel."

"This CAB provides an opportunity for us to get together face-to-face.  I know the relationships I've built, and value I get from the CAB are far greater than what I get from any other [host company] event."

"We're planning to expand significantly, so the CAB is very important to me.  So far, my experience on the CAB has been great as [host company] really listens to our feedback and has implemented many of our suggestions."

EngageThese are incredible testimonials to the value of customer engagement programs, and specifically, Customer Advisory Boards.  One member went as far as to offer to host fellow members at her organization for the peer sharing and networking benefits!  

Clearly these members have experienced the benefits of participating on an Advisory Board.  They have a "seat at the table" with the executive leadership team allowing them an insider's view of the host company's strategy and direction.  They also have the opportunity to be that "voice of the customer" for the host company. 

Don't underestimate the impact of your CAB program.  And be sure to communicate clearly and often about plans and next steps.  As one meeting is completed, start planning for the next one by choosing a few dates to share with members, asking for their best availability.  Remember: continuous engagement and early planning are keys to success!
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Engaging the Sales Force Through Training

Word is spreading throughout the sales force about a new customer program called the Annual Customer Review, but the sales force doesn’t quite understand how it will impact them and their customers.  In order to dispel any myths and provide accurate information to every sales person, a training curriculum will need to be developed for the Annual Customer Review program. ABC

The team responsible for the education of your sales force should be engaged in the development and the deployment of the Annual Customer Review program curriculum early in the program timeline.  These are a few questions that will need to be answered prior to the creation of a more formal training plan:

• Who will create and deploy the training curriculum?
• What is the best method for deploying the training?
• How much will the training cost?

The answers to the questions above each have their own dependencies e.g. the training method selected will be based on the overall budget available.  The size of the sales force that must be trained on the new program is another consideration when determining training cost and deployment method.  Whether the training is done regionally, at headquarters or done via webinar the end goal is to train the sales force prior to their need to deliver a Customer Review to a customer. 

The development of an overall training strategy is an essential element for the success of the program.  Even more importantly, engaging the training organization early and keeping them involved throughout the rollout of the program. 

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Flexibility and Relevancy Key to Interactive CAB Discussions

I recently attended a Customer Advisory Board meeting with a well-establishepeople meetingd group.  Some of the members have been on the Board since its inception (3 years), while others have joined within the past year.

During an open discussion in one of the sessions, several members shared a similar concern about a specific trend from the host organization.  While this particular topic was not on the agenda, the group consensus was to spend some time discussing the issue.

There are times when unexpected topics come up, and knowing when to "adjust on the fly" is important.  Before changing the agenda, ask yourself these key questions:
  • Is the concern shared by and/or relevant to the majority of the members?
  • Does the Executive Sponsor want to explore the concern at the meeting or hold until later?
  • What would be the best format to address the topic (open discussion, small group discussions, etc.)?
Good facilitation is crucial when it comes to "shifting gears" or adjusting the agenda.  Adapting to the needs of the customers, as long as the Executive Sponsor agrees, shows flexibility on behalf of all parties.  When properly structured and managed, these conversations can help the host not only understand the problem more clearly, but also the underlying causes and impact.  Once that is complete, having the CAB shift to an Advisory role is key to addressing the issue at hand.  This approach will also stop the discussion from evolving into a "complaint session," which only leaves everyone frustrated and with no mutual action to address the core issue.

For the meeting I attended, the change was well received.  A concern was voiced, and the host organization is now better informed on what expectations are for the future.  They are currently addressing this concern internally in order to fast-track a solution.  This is a great example of CAB members truly fulfilling their mission of "Advisor."
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Keys to Communicating During Pilot


Your Annual Customer Review program is well underway at this point with activities such as pilot selection and the creation of the Customer Review document.  Our next to-do for the program is to begin engaging the pilot accounts in the Customer Review process.   The best way to communicate with a group of people that is geographically dispersed and ensure a single message is communicated is through live conversation. 

A weekly conference call with the pilot accounts will keep everyone on track with the actions requested of them by the program team.  The feedback you receive will proTin Cansvide your program team with new ideas, as well as information on areas that require process improvement.  The conference calls should be structured and focused.

• Explain each step in the Annual Customer Review process
• Instruct participants on required deliverables
• Invite best practice leaders
• Solicit feedback
• Review tools and templates

The Leadership Team should receive regular updates on the progress of the Annual Customer Review program.  As the pilots make their way through each milestone in the program, communicate their success.  The Leadership Team bought into the program, so keeping them informed throughout the pilot phase will ensure their endorsement during the program launch.

Another key element on any communication strategy is to publicize your accomplishments.  The success of each pilot account should be communicated throughout your company.  You can gather quotes from the pilot reps and testimonials from their customers.  Hearing directly from your customers on their experience with the Annual Customer Review will provide the sales force the proof that the program really does work.    

Remember, communicate with your pilots reps throughout the pilot phase, keep the Leadership Team informed on the success of each milestone achieved and finally, spread the word about the program by capturing feedback directly from your customers.

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B2B Focus at Loyalty Expo March 20-22, 2011

Many conferences showcase and feature executives from high profile B2C companies like Starbucks, Apple, Victoria Secret, Coke, Disney, Facebook, and Amazon. The reality is that many of these B2C concepts can’t be applied to the B2B world.

And when you hear incredible B2C stories, how often have you known that it just wasn’t applicable in your company? It can also be frustrating and even worse, hard to justify the time and money invested in attending.   

The Loyalty Expo this year has a dedicated B2B track focused completely on B2B companies. The sessions won’t tell you how to develop customer intimacy like Apple, manage your rewards and social media programs like Coca-Cola, drive loyalty like Starbucks, or treat your customers like Disney. These companies operate in the consumer “B2C” world of retailers and consumer package goods organizations, and we recognize this is not your B2B world.  It’s not even close.

In the Loyalty Expo B2B track you’ll hear from leading B2B firms in the world, those who have achieved remarkable customer retention and loyalty and who have designed and built both world class Voice of the Customer and customer relationship programs. And while the names may not be as recognizable as Coke and Starbucks, their organizational successes are equally impressive.

Here are the five B2B sessions which were designed specifically for you. Hope to see you there!

loyal
Customer Relationships: The Road to Becoming a Trusted Partner
Speakers: Sean Geehan, Author, B2B Executive Playbook | Tom Webster, GM US Operations, iTrade Networks

Maximizing Channel and Supplier Relationships
Speakers: Greg Greve, VP Procurement and Customer Service, Standard Register | Scott Musson, Sr. Director Global Alliances, VMware

Social Media’s Fit in Your B2B Marketing and Loyalty Programs
Speakers: Sami Hero, VP Global Open Web, LexisNexis | Julie Schwartz, SVP, ITSMA

Technology 411
Speakers: Marcus Starke, US CMO, SAP | Samir Bagga, VP Marketing, HCL

Why Satisfaction Isn’t Enough
Speakers: Jon Windley, VP of Client Loyalty, Savvis | George Scotti, US Marketing Director, Springer)

To Register go to http://www.loyaltyexpo.com/

Friends of Geehan Group 20% discount code gg20.

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