During the economic free-for-all of the past 12-14 months, many companies
consider themselves successful if the "open" sign still glows. But
undoubtedly, conditions will improve just as they historically have, and it
will be those companies who seize the opportunities inherent in the current
conditions, and position themselves for future growth, that will dominate
their markets in the future.
Jim McCarty, a former client and personal friend, and former Senior Executive
Vice President of Ecolab, has always held these beliefs, which helped turned
Ecolab into the dominant leader in the industry of institutional sales.
Three core strategies Jim employed during his 30 plus years at Ecolab, where he
oversaw five divisions, 4,000 people and more than a billion dollars in
sales, can prove just as a successful for even the smallest startup company,
and organizations of all sizes in between. The three strategies are all
woven with a common thread.
See if you can't detect that thread before
reading about it in the last paragraph.
1. Retain.
Jim believes this strategy should be at the top of any company's
priority list.
By retain, he means the following:
First, we must retain all the associates who work for us. I've
conservatively estimated that turnover losses cost a company more than
$100,000 per mid-level employee when costs such as recruiting, interviewing,
hiring, training, and lost production are calculated.
Second, we must retain the company traditions and the culture that have made
us who we are today. There are many key reasons why a company is successful,
and often it's the core values, company culture, and other differentiators
that are undoubtedly important, yet don't appear in a product catalog.
And third, we must retain our customers. It's much easier and more cost
effective to retain a customer than win a new one. Additionally, the longer
you keep your customers, the more you set their expectations and cement your
company's image as an industry leader.
Research shows that it's five to six times more costly to gain a new
customer than retain an existing one, making it absolutely critical to
retain customer during a recession.
Remember that outside of a quality
product or service that's delivered on time, the single most impacting
tactic you can employ to retain customers is to reinforce your company's
position, along with the sound business reasons why the customer chose - and
is continuing to choose - doing business with your company.
2. Grow.
First, we must grow the employee's knowledge. We must grow our associates by
teaching them how to be more effective at what they do. At Ecolab, this
meant creating Ecolab University where every employee received hands-on
training specific to his or her position, which resulted in him or her being
better trained, and better able, to help customers.
Second, we must grow the number or products and services we provide
customers. As we serve our customers, we can partner with them to fill their
needs. And as we move closer to partners than suppliers, we can add even
more value by anticipating our customers needs before they even realize
them, and then filling these needs as a course of our service. Such forward
thinking and a customer-first approach makes you a highly-prized
consultant - and partner - one not easily let go.
Third, we must grow our top line. This might be the most challenging of the
recommendations, but it can be highly impacting. What typically happens
during tough economic times is that company's become misers, and focus
solely on protecting the bottom line. The true leaders will view such
tactics by competitors as an opportunity, and invest in their company's
ability to exploit the economic upturn when it assuredly occurs.
3. Gain.
We must gain new people that bring talents that don't exist today.
Partnering the talents and ideas of 'fresh thinkers' with our proven talent
is a solid success principle.
We must gain market share against competitors. This is actually easier to do
in a tough economy than in a booming one. However, it requires considerable
foresight, planning and dedication to see it through.
Third, we must gain new ideas for products, services and offerings that don't
exist today by engaging our customers. Your company should always be
anticipating your customers' needs and asking each directly, "What else
could we do to help you achieve your objectives?"
Accordingly, anything that a company can do to retain their people, grow
their knowledge, and gain new people, the more likely they are to have
stronger relationships with their customers and become an industry leader.
Without exception, the underlying success determinant of all three
strategies begins with your people.
I believe a company's people come first,
and the customer second. If this is so, your people will in fact take care
of your customers. Hence your customers will take care of you through their
buying decisions.
Roy Chitwood is an author, trainer and consultant in sales and sales management and is president of Max Sacks International, Seattle.
Roy Chitwood Article
