Sunday, March 12, 2006

Volume 20 - Differentiation of Independence2, LLC

Do you know how great ideas grab defeat from the jaws of victory?

What happens is that you get this great idea and run it by your friends, family, associates and after some conversation you hear "Nah, you can't do that!" "It would be impossible, and how could you possibly succeed?"

Well, in business, it gets worse. Did you ever hear the saying that arguing with an engineer is like fighting with a pig in mud? And then, it finally dawns on you that the pig likes it. Here's a newsflash; so does the engineer. Same kind of concept. For those with high degrees of persistence, who actually make it past the engineering department, here comes the manufacturing people, who ramble on with "We can't build that!" and proceed to give you a million reasons why the light bulb shouldn't light, not to mention that it couldn't possibly be manufactured without extremely high costs and poor productivity, at which time the accountants simply smile, in their egotistical way, for they have potentially, on paper, saved another penny while stepping over dollars.

There are a number of very good lessons and one sincere statement to be drawn from the above, one about collaboration, and one about control and destiny, all of which differentiates Independence2 from the vast majority of other companies within the arena of Architectural door hardware products.

Most companies actually had 'victory' in the palm of their hands and yet lost it for mostly internal reasons and not external market reasons. Knowing this fact, we at Independence2 have structured ourselves to be fundamentally sound internally, such as eliminating the individual team approach, and have adapted a collaboration approach on major subjects for business development. For example, there aren't discrete, sequential development stages for operational programs anymore than a separate marketing philosophy or sales approach. Projects get worked on in parallel by all departments (by all people)at once with a 'birth to death' approach. Our destiny is wrapped in a 'core value' that forces us to talk incessantly about major categories, including financial performance, software, marketing, products and sales to 'broad stroke' a few subjects. Essentially, it means that products and services from Independence2,LLC don't pass from department to department or are developed in some sort of sequential development stages. Rather, it's simultaneous and worked on in parallel by everyone in rounds of interdisciplinary reviews.

Let me immediately state that this is not an endorsement of 'meetings for meetings sake' nor of long hours hearing 'owners' pontificate. Been there, done that and have paid my dues. There exists, however, review sessions or intellectual developmental stages that attack specific complex challenges that involves everyone within the company. We develop products and services in a more collaborative and integrated way than other companies that I've been associated with. Our meetings will be long on productivity and input. This process therefore requires a great deal of quality people, with diverse backgrounds, willing to submit themselves to such involvement in exchange for a 'piece' of ownership in a company and the opportunity to build wealth rather than just 'a job'. Our design system, internal and external, is a collaborative one that encompasses all facts and that, emphatically, includes the customer. We have concluded that our differentiation is in what we offer outside the product box. This will not only help us at the outset of this venture but also into the developing markets for our growth ahead. We'll become the gatekeeper to 'customer satisfaction' within our industry.

Within our industry, businesses both manufacturer and distributor, used to be able to compete based on price and product. Today, assuming a high-quality product that is competitively priced, a company's success will be determined by the service it provides to customers and the understanding of the customer's business. That's because today's customers should demand that their satisfaction comes first. Although most intelligent business people understand and agree with this, few distributors (customers) are doing anything substantial about it. Why? My guess is that they don't know how or unwilling, at a certain stage of their development or business maturity, to 'rock the boat' with regard to their suppliers. Yet, in some cases, the major manufacturers attempt to control the entire construction, material supply process, and have all but eliminated the very valuable distributor. Today, for example, on pricing issues for medium to large products the distributor is waiting until the 'eleventh hour' to obtain 'job' pricing. This is a 'control' issue and subject to another 'blog' issue in the future.

Let it simply be stated that our organization believes in the contract door hardware distributor and locksmith house and believes that their expertise is, in fact, a vital link in this supply chain. It is our duty to service, not control, and respect that chain. It simply goes back to the statement that if you can't differentiate what you deliver outside the product box, you're forced to compete at the lowest levels of the playing field. If you're working on a continuous improvement of your service capabilities, processes, product offerings and your ability to communicate your company's unique value package, your customer maybe able to differentiate why you are better than the rest of the other growing options out there.

An example of this pertains directly to the Sales force and sales approach of Independence2. Not in the fact of Direct Sales personnel versus that of manufacturer representatives but at a more meaningful level of understanding the customer. It is a proven fact that a growing portion of the customer base finds little value in the traditional sales call made by the traditional salesperson, direct or 'rep'. As customers move away from spending time with salespeople, these salespeople will confront customers who have many alternate sales channels including e-commerce and a proactive inside sales program. As I stated, in my volume 14 edition on 'Consultative' selling, the sales people must become more highly skilled in this technique for the days of success at distributor selling consisting of pitching a price and becoming the customer's lapdog are coming rapidly to an end. Skill at bringing real value to customers every time they are in contact with them is now paramount. Also as stated within that volume 14, "In an industry characterized by brand name and quality of product upgrading with generally poor service standards and little respect for distributors, Independence2 will, through a respect for an commitment to its distributors, effect a change that will affect practices for the new building and after-market end users, architect's, contractors, facility managers commercial and industrial building owners."

No comments: