Business,Axiom,Never,Hibernate business, insurance Business Axiom # 2 - Never Hibernate with the bears!

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There is story about a successful business. It was a family owned business and each year it grew and returned above average profits to its owner. This continued for over 25 years. The business became so successful that the employees prospered and the owners were able to send their eldest child to an Ivy school where he majored in business and received his MBA. Once the son returned from college, his father was anxious to have him join the business. His son, fresh with MBA in hand, began to review the business. In short order he told his dad that there is an impending recession. All the newspapers were predicting rocky economic times ahead. The son noted that Wall Street was preparing for a bearish market condition. However, the son felt he knew what course of action to take. For the past 30 years his dad worried little about such matters. He made the best product and provided unparalleled service to his customers and his business always flourished. But his son protested and strongly recommended to his dad that cut backs were the prudent thing to do under these uncertain economical times. Further, the son pointed to many of his father's competitors who already made cut backs in their business. The father never went to college, so he assumed that his MBA graduated son knew more about the economy. As his son suggested, the father began to cut back on his normal business practices and sure enough, as his son predicted, the business softened. The softer the business became, the more the son recommended that expenses be reduced and investment be eliminated. Although this was contrary to the father's normal business practice, he complied with his son's suggestion and sure enough, before long the father went out of business. In a time of uncertainty (when is it not some form of uncertainty) it might be tempting to pull back. Under the guise of ‘being prudent' senior managers begin to contract their thinking. The organizational focus zeros in on plans to cut back while finding logic in not investing. Advertisement, creative marketing programs and seeking new business takes a back seat to cost cutting. Putting off new product ideas or delaying product introductions becomes appropriate behavior. This thinking begins to pervade the organization. Soon everyone is looking for ways to lower costs. People find ways to rationalize cuts in customer service, or prudent (there is that word again) ways to lower quality standards. Increasing discounts, or lowering a bid to ‘get-the-job' becomes the norm. Generally the organization begins to over-commit and under-deliver. Your organization may now be in a prudent mode, but missed an opportunity to grow by taking market share from timid competitors assuming the same ‘prudent' position. This brings us to Global Marketing's 2nd business axiom: Never hibernate with the bears Remember that economic black clouds also hold silver linings. Opportunities always exist, but you have to be looking. Companies that seek new business potential and muster the courage to act gain a competitive advantage and normally increase their market share as the economic turn-around occurs. In funky financial times the first cut is to the advertising budget. Why? Because it appears to have no short-term business impact, while providing immediate cost reduction. Unless your company is in danger of going belly up, this is exactly the wrong thing to do. This is dangerous short-term thinking! Advertising during tough times holds tremendous value. It keeps alive the connection between you and your customer. It let's them know you're doing fine and still in business. Don't under-estimate this point. Advertising at this time communicates a powerful message. It says you are strong, in it for the long-term and re-enforces the fact that they made a good choice. Advertising during tough times also frightens competitors and this gains you new business. Customers look for better deals and don't seem fearful of moving to other companies that appear to be stronger during uncertain times. Give a potential customer the visibility of your company through advertising. Usually, more individuals will see your ads because fewer people are advertising during these times. Besides periodicals are more than willing to reduce their rates during recessionary times -- some cutting them in half or more. Don't take your foot off the investment pedal. It is tempting to reduce your R&D budget, even a little to make things easier. Don't fall into this trap. When you look at companies that consistently grow, you'll find that they invest wisely in their R&D programs during uncertain economic times. When times are good they invest even more. New products are the lifeblood of most organizations. Defining a need and filling it with your technology is the best way to get through turbulent times and set-the-stage for renewed growth in better times. Move products to market faster. Develop a few "quickie" projects that enhance or add to present products. Find ways to get these products in the hands of your sales reps sooner than normal. Remember that a sales person needs a reason to visit a customer. It's even more important to give them that reason when times are slow. More often than not, while he is introducing the new or enhanced items, he will sell legacy products or get a line on a new project. It's always about the customer. Tragically, during rough economic times, companies become in-ward looking and lose focus on the customer. Companies begin to find ways to cut costs and usually this means reduced service to the customer. The financial people convince you that reducing the warranty will help reduce corporate liability. You ask about all the sales literature being used and decide a 10% cutback won't hurt you. And so on. Reject these and any other idea that is a backward step in customer service level. Again, get creative. Many customer service ideas cost little and mean much to the customer. Talk to your customer more during turbulent times. Find out what their business is doing? Determine how you can better service them. Find ways to make their buying experience even better. When was the last time the CEO or President of the company sent a letter to your customers thanking them for their business? IT technology makes this too easy not to make it a routine and something that can be inserted quickly. Do you routinely survey your customers on your service, product, quality level, etc.? If not, begin it today. IT can help and e-mail makes it easier and cheaper than ever. One caution on surveys - make sure you act on the feedback. Assign a team of sales people to each customer. It's easier than it sounds. The team should consist of an inside sales support person, a technical person and a salesperson that leads the team. Make it known to your customer that they have a special team working for them. Proactively and timely communicate bad news to your customer. If you can't meet the delivery you quoted, let them know. Honesty is still the best policy. Use technology and the Internet. It's accepted, pervasive, and efficient to use. There are ways to inform without being intrusive to your customer and potential customers. And the good news it that it's inexpensive too. Create a weekly or bi-weekly eNewsletter. Send out information on products or programs. Revisit legacy products. There must be plenty to brag about. Study the HP's, GE' and Emerson Electric's of this world and you will find that these are well run companies that find ways to take advantage of a soft economy. They seek opportunities. They strengthen their market position by investing in new products and service that better serve the customers. They hammer away at timid competitors more easily taking market share from them. But they never, never hibernate with the bears! Global Marketing Inc., is a leading business, marketing and sales consulting firm located in San Diego, CA. With more than 25 years of experience we have the programs, ideas and assistance to help move your company to its next level of performance. Take action and call today for additional information on these ideas or other ways in which Global Marketing can help enhance your Sales and Marketing efforts. More articles here: http://members.cox.net/glmarketing/glmarketing Article Tags: Business Axiom, Never Hibernate, Economic Times, Find Ways, Customer Service, Market Share, Advertising During