Workplace Engineering

The biggest “aha!” that I’ve had since starting my own business is how difficult it is to get your message out and to encourage potential customers to buy from you. I used to flatter myself that I was a good communicator and could persuade business leaders to follow my recommendations. Since last summer, I’ve found out that moving from selling to internal corporate customers to selling to real customers is like doing well in the little leagues and then walking out into the Superbowl. It’s enough to make you want to change your pants/trousers!

Here are some of the things I’ve learned:

1 - Great sales professionals deserve HUGE RESPECT! It takes a special kind of person to walk into a room, create rapport, build trust, maintain enthusiasm and have the stamina to eventually close the sale.

2 - A lot of sales professionals are not great. We’ve taken mentoring from a number of sales people along the way. As we’ve learned more, we’ve figured out that most just are not that good. Fortunately, we have one in our back pocket now who is causing the scales to fall from our eyes (you know who you are).

3 - The sales cycle isn’t like running a marathon, it’s like sailing around the world! In a marathon you have some control - train and eat well and put on a decent pair of running shoes and you should get to the finish line at some point. If you are sailing, you need the right training, right clothes, right boat, right equipment, right charts, right crew….and then you put to see, hoping that you’ll make all your checkpoints and get to your destination before you sink.

4 - Selling enterprise software is really hard! First you need to find out if a customer for your software actually exists. If you have an application that runs across organizational boundaries, it is especially difficult to find someone who can make a decision. If you can find someone who can be a champion for you, you are now in a race to get through all of the gates to an order before they move on to bigger and better things.

5 - Software is not a complete product (or at least ours isn’t). After spending six months as a pure software play, realized that we actually need to put food on the table. So, we’ve started to consult. Guess what! Now people are starting to get interested in our product…..provided we consult too.

6 - It’s the benefits, Stupid! I have spent six months extolling the features of our portal only to find out that our possible customers don’t really care. They want to know what our product can actually do for them. Our customers may not be able to calculate ROI is or even give a business school definition, but they have a very healthy understanding of what return on investment actually means.

7 - Focus. Focus. Focus. It is easier to sell a product that does one highly targeted thing well than a complicated the cure for world hunger. We’ve moved from selling a general light-weight online dashboard/scorecard that does everything to a services-vendor KPI reporting tool.

8 - It’s all about the customer. I did a Dale Carnegie course last year. It has taken me around a year of soak time to finally get the idea that it really is about them and not about me.

Big Up Respect to great sales people. I think I’ve at least found where the path to sales success starts now. 2009 is going to be about learning more and actually doing it!

Zen Habits post A Minimalist’s Guide to Using Twitter Simply, Productively, and Funly: is really helpful to anyone like me who’s been trying to figure out how to engage with Twitter….

“Twitter is like a river … you can step into it at any point and feel the water, bathe in it, frolic if you like … and then get out. And go back in at any time, at any point. But, you don’t have to try to consume the entire river — it’s impossible and frankly a waste of time in my eyes.

So that’s how I approach Twitter these days: I’ll just jump into the stream of incoming tweets and see what people are saying. I can ignore them or follow their links or reply if I want. Then I get out of the stream. I don’t try to read everything I missed, and if I miss a lot of stuff, I’m OK with that.”

I think this advice could apply equally to all the corporate information my clients have to keep up with. There are some core performance KPIs that they need to be on top of all of the time, but much of what passes an executive these days is just the flow of the corporate river.

(See the rest of the post in Zen Habits.)

Successfully outsourcing can result in considerable cost savings and performance and capacity improvements for an outsourcing organization and can provide opportunities for economies of scale that would be otherwise impossible.  If an organization could achieve all of its goals by itself there would be no need to  enter into business partnerships and the outsourcing industry in particular would be much smaller than it is today. Ten of the pitfalls an organization faces are:

1. Poor Planning
2. Marry in haste, repent at leisure
3. Faulty Financials
4. Underinvestment in the Transisition
5. Brain Drain
6. Passive Agressive Teamwork
7. The Tower of Babel
8. It doesn’t last
9. Losing the wood for the trees
10. Unrealistic expectations

These pitfalls can be avoided through planning, insight, and a commitment to communication and sustaining the change that comes along with a successful partnership.

There is a temptation to over measure and get lost in detailed performance metrics and lose sight of the overall objectives of the partnership. After taking the time to develop detailed processes, understand key quality items, benchmark and then developing a complex algorithm linking pay to performance that a mad scientist would be proud of, performance stubbornly refuses to budge and great expectations are dashed.

This temptation to measure and set targets for everything the greater the possibility that they will influence each other (in possibly not fully understood ways) and  prevent major gains in any one area. In statistics, this is known as “regression to the mean,” for the poor individuals managing or performing in this scenario it is a classic no-win situation.

It can also be tempting to set arbitrary standards because they seem to make sense at the time. The percentage is the biggest villain here. 98% performance may sound great or 99.99% may sound like perfection. When that becomes a target for missing mail for an organization delivering 100,000 letters a day to a business, it means that that means 99 can go missing each and every day. Reality checks are critical when setting targets.

Both of these problems can be avoided by taking a step back to clarify objectives and what actually needs to be measured and then give that balanced scorecard a healthy dose of reality.

Even within supposedly single industries with common training structures, regulated activities and well defined professional organizations there is a surprising amount of disagreement over fundamental definitions of an object, service or performance. 

Turnaround or response times are a key item in many outsource partnerships, yet the start and finish point can be a major point of disagreement. For a customer, the start point may be when they first picked up the phone and had an informal conversation, for the help desk when the work order was actually entered, for the maintenance manager when they got it and the ultimate performer when they were asked to do it.

The possibility for confusion and disagreement around definitions, standards and service levels are enormous. Although reference to recognized to standards endorsed by IFMA, OSCRE, BOMA or other institutions is a great start, time must be taken to develop an agreed set of performance criteria that can be measured and actually reflect a common understanding of the operation or service.

Introducing a new partner into an existing environment or creating a whole new environment out different parties coming together to form a team creates a new dynamic that needs to be worked through to enable the team to perform effectively.

Without knowledge of how involved the client team should be in the day to day running of the operation, there may be a tendency to stay out of the expert’s business. Until there is a problem, that is. 

With pressure from above of dissatisfaction from the recipients of the service there is huge temptation to intervene directly to resolve the problem and become highly directive. Where the partnership was set up to effectively just out-task items or just use the labor of the other party this may not be such a big deal. In partnerships where the goals are more wide ranging, potential strategic benefits can be quickly lost.

In fact, these behaviors are the result of people using “common sense” to fill a vacuum and make an ambiguous situation workable. Preventing this needs management tools that work. 

Understanding and agreeing escalation processes, decision rights and mechanisms for correcting poor performance is critical as is understanding and agreeing the objective criteria for measuring performance and ensuring that a mechanism is in place to collect and share them with the people that need them.

Perceived poor cost performance can be the result of a lack of understanding of the true costs with providing a service or operation, additional costs that occur as a result of managing a partnership, a genuine difference in costs or increased awareness and visibility being mistaken for an actual increase.

Very often and organization has not taken the time to fully evaluate and apportion the true costs associated with providing a service internally until the time comes to have that service or operation provided by someone else. As a result, there may be limited insight into the overhead and administrative costs associated with the service and for some organizations, internal pricing may obscure the true cost of the service itself.

Understanding the fully loaded costs of a service or operation gives real insight into the true cost structure, what savings can and cannot be expected and then provides a suitable benchmark for measuring success over time. It will also help identify where the true costs are and allow the partners to develop an effective plan to improve performance in the right places.

Remember that fully loaded costs include administrative and overhead costs in addition to the costs of providing the service itself.

More detail on the process for securing a vendor partner

Pre-qualification (finding suitable parties). This is where an industry consultant can be useful in identifying potentials based upon an understanding of the work, processes and performance criteria. Depending on the size and complexity of the work, this process can take several rounds or happen pretty quickly.

Document preparation. The processes, performance criteria and overall goals established earlier in the process are turned into formal scope of work documents, business requirements, performance metrics, inventories, staffing lists that form the basis of the procurement exercise.

Out to bid (or RFP). Packaging up all the documentation into a standard form, adding contractual terms, building a pricing list and then sending it to pre-qualified bidders. 

Return (of the bids). During this period, the potential suitors work through the documents, ask questions, clarify requirements and generally build a hopefully compliant proposal. This stage culminates in the return of a bid.

Place Order. Once returned, bid documents need to be evaluated and compared. A clean package of outgoing documents containing easy to understand and unambiguous descriptions, criteria and requirements increases the possibilities that the bids will be directly comparable. Pretty quickly front runners will emerge and the team will move to tighten up and negotiate requirements, offers, counter-offers etc. until the favored bidder emerges and a contract awarded.

Start work. Once an order is placed, there is a period of time when both organizations prepare to actually do business with each other. Again, the level of complexity and scope can influence the time, extent and energy. This is a period when the contracting organization can do a lot to ensure the proper integration and success of the new team.

Not understanding the basic fundamental activities, resources and performance criteria for an activity or function make it difficult for a potential partner to be successful. Unrealistic expectations and lack of knowledge of the procurement process can lead to a poorly executed exercise that at best means that the parties need to rework their agreements very early or at worst results in a disastrous relationship that is unwound in acrimony and sometimes with the help of the lawyers.

Understanding and allowing the time to go through a proper selection process increases the chances that the resulting relationship will be successful for many years. Organizations have different methods and processes that they undertake to search for, find and then contract with a partner. Most successful ones contain the steps of

• pre-qualification
  
• document preparation
  
• out to bid
  
• returning of bids
  
• placement of an order
  
• starting work in one form or another.

Under pressure to achieve a quick result, the temptation is there to short circuit the process or negotiate with a single party. Unfortunately, the absence of clearly defined steps and milestones that can be monitored and measured can result in a long and drawn out process that is ultimately unsatisfactory to all concerned.

There is a British Army axiom that perfectly proper planning produces perfect proper performance. Many organizations that enter into some form of partnership set the stage for disappointment through inadequate planning. There may be lack of insight into the effort and resources required to deliver a service or how to evaluate their own performance. Taking the time to understand the processes, resources, required performance and actual performance before the formal search for a partner begins is critical for ensuring success.

Fortunately, there are some relatively simple methods to assist with planning. The Six Sigma processes of developing a SIPOC and CTQ can go a long way to developing an understanding of the processes within an operation and the elements that are critical to successful performance.

The SIPOC provides an effective way for a team to map its processes at a very high level; identify the individuals, teams or organizations that are suppliers to the stages in a process;  what they actually input to that stage; what outputs are needed to allow the next stage to occur and who the customers of that output are (the final customer or whoever is carrying out the next part of the process. Developing a SIPOC should be a wide collaborative process and may need a trained facilitator to ensure that the team flies fast and high and doesn’t get stuck minutiae. Scope of work documents, business requirements and other contractual items are much easier to write and understand with a fundamental understanding of the overall purpose and processes within an activity.

With an agreed process the areas that are Critical to Quality can be identified. Most people and teams perform better if they understand what success actually looks like. As importantly, understanding what success looks like in measurable terms makes it a  whole lot easier to describe to an outside party what is important. CTQ is another Six Sigma tool that is pretty accessible to most team members and can be used effectively without a deep knowledge of statistics.

Of course, there are other methods that can work equally effectively to help teams and prospective partners understand achieve a common understanding of the processes in an activity and what success looks like. Going to the effort early in the process helps to ensure that expectations are founded in a common understanding and sets the partnership up for success.