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!

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.

The failure to meet unrealistic expectations can have a huge detrimental impact on a business partnership. Business partnerships and outsourcing relationships in particular are complex, lengthy, involve considerable change and require both personal and organizational investment to be successful. Lack of understanding, over ambitious promises and lack of preparation and rigor can all lead to expectations that are not matched by reality.

Knowledge, preparation and communication are the answers to unrealistic expectations. Developing a deep and structured knowledge of your processes, needs, performance requirements and your partner capabilities drives realistic criteria. Deep preparation leaving little to chance ensures that scenarios are thought about and surprises are reduced. On-going, honest and clear communications ensures that everyone is on the same page and there is little room for unrealistic expectations.

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.

Unless there are clear tangible and intangible benefits from the new arrangements there can be a significant tendency to revert to old ways of doing things.

Investing the time and energy to make the partnership and the relationships with in it are the only prescriptions for ensuring that the change holds and continues to deliver value. Using Prosci’s ADKAR stages of change can provide an effective gauge of personal and organizational progress in a transition

• Awareness - Identified that a change is coming
• Desire - A willingness to change (have decided to support the new over the old)
• Knowledge - knowing how to change
• Ability - implementing new skills and behaviors
• Reinforcement - maintaing the change once it has occurred

(Adapted from “Employee’s Survival Guide to Change by Jeffrey M. Hiatt)

It’s quite a time consuming and resource intensive process to find and transition in new ways of doing things. It is the small interventions all the way through that ensure that the change becomes as embedded as the old way of doing things.

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.

So by now you’ve figured out that this is pretty much entirely focused on outsourcing partnerships.

Particularly in an outsourcing partnership, an often unstated goal of the partnership is the transfer of knowledge from one partner to the other while keeping it available for both parties during the life of the partnership. While much of the technical knowledge may be documented as well as possibly in the best practice process charts and proposal documents, much of the organizational knowledge on how to get things done and the nuances of the service or operation is held within the heads of the people currently doing it.

This knowledge is critical importance during the early stages of a transition. People that believe they are being poorly treated or feel insecure may decide to “jump before pushed” or withhold that knowledge they have built. 

A solid retention strategy that explicitly targets key personnel before, during and after implementation is a highly effective way of preventing the brain drain. Communicating widely, clearly and openly during the entire process increases confidence and makes it more likely that people will stick around.

My latest science project reaches another milestone today. We have our ribbon cutting at the Frisco Chamber of Commerce. Even in the short time we’ve been working on starting up a business I’ve come to really appreciate the need for lots of little milestones and celebrations to keep motivation up.

The building the chamber occupies is up for sale. It’d make a great coworking space. Maybe there is someone out there who still wants to put money into real estate.

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.