If you’re reading this, ideally you have read “Entrepreneurs – will your business strategy deliver the exit you desire? Part 1, where you nailed defining exactly what you and your family want from your exit OR you skipped Part 1 because you’re crystal clear about the precise exit outcomes you require.
Now it’s time to get a headline benchmark to establish how “match fit” your business is, as you travel towards exit.
Establish match fitness – the “outside in” & “inside out” test
The most effective way to establish your business’ “match fitness” is simple. All you must do is tally the answers received to these questions from two vital audiences:
• Target customer response: why do you choose our product/service rather than any other?
• Staff response: what’s our customer mantra?
As you will see from the short case study below, when these are not tallying up, the bottom line and brand equity suffers.
Case study – Power retailer
This market leading Energy retailer was losing customers fast, had diminishing brand equity and a whole bunch of screaming shareholders. They were painful times.
Senior Management recognised the company needed to reinvent itself in a landscape experiencing massive disruption and expanding competitive challenges.
The good news was that the senior management team had a strategy on a page in place with all the “right stuff” (namely Mission, Vision, Values, dashboarding, strategies, actions) etc.
They’d also defined an internal staff mantra of “to be customer inspired.”
And yet profits and customer numbers were heading the wrong way and the brand’s reputation was travelling in the opposite direction from its former glory days.
An internal staff mantra is not enough
The problem was that the internal staff mantra of “to be customer inspired” was defined differently by everyone. E.g. did it mean being cheap or offering no contract options or bundling with other services?
As a result, implementation was inconsistent in meeting (forget about exceeding) the needs of the target customer. This lead to inefficiencies, confusion, lost opportunity, competitive risk and a hit on profit.
Quite simply, staff did not know what response they wanted to stimulate from the target customer, and so had no anchor on which to prioritise actions its service customer needs.
Bring in the BBQ test
The fix was wonderfully simple. We call it the BBQ test!
The Power retailer had to establish the target customer response they wanted to stimulate in order to provide the anchor for the internal staff mantra.
To do this, the senior management team (bearing in mind Qual and Quant research findings) answered this question:
What do we want our target customers to say at a BBQ, when asked why they choose our product or service?
The goal here is to define an aspirational, pithy one-liner that it’s impossible to forget.
Remembering the power sector was and is highly fragmented, very competitive, experiencing disruption and by its very nature complex for customers to navigate.
In reply, senior management came up with something so compellingly simple, it was a game changer.
The response desired from the target customers was “everything is easy with XXX.”
This meant the customer mantra of being “customer inspired” had context/anchor, so that every staff action is benchmarked against ‘would it make our target customer say, “everything is easy with XXX.”’
For example, this means not buying market share by being cheap and instead prioritising “no contracts” and bundling with other services.
The turnaround is in place
As a result of aligning the desired target market response with the staff mantra, while implementing the company’s “strategy on a page,” client numbers increased and a pipeline of expanding products and services were designed and delivered with positive customer feedback. Oh – and the shareholders stopped screaming 🙂
Are your target customer responses aligned with your staff mantra?
If you are feeling uncomfortable having read this, you are not alone.
Per Forbes, 70% of employees don’t even know what their company’s Vision or the strategic priorities.
The fastest way to bridge this gap is to embed a staff mantra geared to delivering a specific customer response. This will underpin delivering strategic priorities defined by the senior management team in your business,s which significantly benefits to the bottom line and your brand.
I’d love to hear your thoughts on implementing this.