How Are You Competing – Product Quality

qualityiconThis is part 3 of 4 blogs which will cover the different customer value propositions that a company can use to compete in the market place.

Some people consider this a must-have. There are some sectors and definitely some companies that don’t see it as priority. Those companies don’t see it as a mechanism to make themselves different from other companies. In some cases, consumers are not sensitive to it. It might be an after though during the buying decision process. What are we talking about?

QUALITY!

You either have it or you don’t but it is a matter of perspective. It is also a matter of what level your competition is at.

The quality of your product can be something that consumers identify with your company, good or bad. Many high end brands, like Porsche or Coach, are known for their quality. Jaguar was known for their quality but that reputation took a hit when Ford bought it. Ford started to use their parts within Jaguar vehicles which irritated Jaguar’s consumers. They expect high quality, handmade workmanship going into every vehicle. Putting in mass produced part was not consistent with that picture.

In following a quality model, it comes with extra costs to ensure that the end product always meets the needs of the consumer. Lean and Lean Six Sigma is commonly used to help increase the quality of the end product while staying economical. Consumers, however, are willing to pay a higher price for that increased product. The higher quality may decrease headaches that consumers have. It can help the company set itself up as a brand of quality.

What companies can you identify that compete based off the quality of their product? Which companies have fallen off that pedestal, in your opinion?

Have a productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for the South Edmonton Business Association, the Fringe Festival, Goodwill Industries of Alberta and donates blood at the Canadian Blood Services.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

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How Are You Competing – Innovative Product

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This is part 2 of 4 blogs which will cover the different customer value propositions that a company can use to compete in the market place.

Competition is something natural for people. We all have a competitive streak. Some of those streaks run deeper than others, but it is still there.

When companies are competing against each other, competition can take on different forms. We have already looked at operational excellence, where companies want to be known as the cheapest in their industry. Is there a way to compete where you could be the most expensive in the market but yet consumer are accepting of it?

What if you consistently brought on new technologies, usages, or ideas to market? Would your consumer pay a premium to buy the latest and greatest item? Many do and some companies compete on that basis.

Many innovations in the car industry get their roots from Toyota Motors. They were able to find ways to bring new technologies and usages for cars that other automakers hadn’t implemented. Products made by Toyota are generally higher, in terms of price point, than their competitors.

Being an innovative company does come with pitfalls. What do you do with your corporate strategy when another company leap frogs your cutting edge product? Do you add extra resources try to leap frog them so you are back in front? Possible, but research and development into products is not a cheap venture. Do you have the financial and human capital to orchestrate that leap? You could be spending a fair amount of resources try to get back in front but never get there.

What company do you consider to be a consistent innovative leader in their industry? Any companies you felt were in that position but haven’t been able to keep up to change lately?

Have a productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for the South Edmonton Business Association, the Fringe Festival, Goodwill Industries of Alberta and donates blood at the Canadian Blood Services.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

 

How Are You Competing – Operational Excellence

excellenceThis is part 1 of 4 blogs which will cover the different customer value propositions that a company can use to compete in the market place.

Every company competes, in one way or another. Either they are competing to get attention with a gorilla marketing strategy or to simply get new customers. Competition is a fundamental part of any marketplace. Unless there is a monopoly or duopoly in place, market forces are moving resources between companies.

The weakest of all modes for competition in business is operational excellence. In the eyes of the consumer, you offer the cheapest product of all solution providers within your space. Your business model is based on maximizing your capacity and selling as much of your product as possible.

There is one Fortune 500 sized company that comes top of mind when you think about a company that is operationally excellent….Walmart. Walmart, in the eyes of the consumer, is the cheap place to go, in general, when you need to buy something. They are not very innovative in their offering. Customer service, well, you have to be able to find someone on their store floor to consider customer service. Lastly, quality products is not something that rings with Walmart.

When you create your company with a business model of being operational excellent, you are more than likely to attract a large portion of consumers. Who doesn’t want to save money?

But in following this model, it becomes hard for your company to raise prices. You have to ensure that you stay top of mind for your consumer when it comes to buying something cheap. But what happens when someone else decreases their prices below yours? Well, if you are tried and true to your strategy, you will decrease your price too. This will only start a race to the bottom. In reflection, you have just commoditized your offering and your consumer will always go to the cheapest name, no matter who it is.

There are some circumstances where being the cheapest in the market is the best position. You may be focused upon an economically sensitive target group which is under served. Perhaps you are entering a new market with a new product and you want to help accelerate adaptation of your offering.

Does your company want to be the cheapest in its industry? What companies do you see fitting that bill?

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for the South Edmonton Business Association, the Fringe Festival, Goodwill Industries of Alberta and donates at the Canadian Blood Services.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

Marketing In a Weak Economy

This article was originally published on the BusinessLink’s website.

Small Business Week (Oct 16-22) is an exciting time for entrepreneurs with great events across Canada offering small business owners multiple opportunities to learn and connect. One of the many events that I attended was organized by Business Link named “Ignite Small Business Week YEG: Marketing in this Economy!?”

The highlight of the event was to hear Randy Brososky from the Group of Rogues speak about how companies should market themselves during a period of weaker economic growth. I have heard Randy speak before and I knew that he would bring great knowledge to business owners to help them grow their business.

SOLVE A PROBLEM

When you are looking to market your company and its offering, remember: “To a fish, the universe is water.” In terms of your company, you truthfully have to look at yourself from the viewpoint of your customer. What problem(s) are you solving? Are you making the purchasing process logical or emotional? Are you tying these items together to make it easier for your customer to choose you?

WHAT ARE YOU REALLY SELLING?

Rolls-Royce is well known for selling cars but they also make jet engines. They understand from the view point of their end customer- the more time that a jet can be in the air, the more money airlines make. With that in mind, Rolls-Royce does not ‘sell’ a jet engine; they sell time in the air. They repair their engines for free. The only time that Rolls-Royce charge for their engines is when that engine is flying in the air.

FIVE TIPS FOR MARKETING IN A SLOW ECONOMY

Here’s what marketing guru Randy Brososky shared at the event:

1. CUSTOMER CONNECTION: Stay in touch with your customer but don’t sell to them. By keeping that connection open, when the economy starts to swing upwards, your customer will remember you and go to you first.

2. SHIFT HAPPENS: People shift their spending habits as times change, but are you shifting along with them? 10 years ago, Tim Horton’s coffee could only be bought within their locations. With the shift to home brewing and Keurig cups, Tim Horton’s coffee can now be purchased in grocery stores (or in their locations) in grounded bean format or within Keurig cups.

3. SMART DISCOUNTS: Offer 2 for 1 deals but the deal is only activated after you have involved your customer. For your customer to get a 2 for 1 deal, have them bring a friend. You can also have your customers become brand ambassadors. Offer them discounts when they speak to their community about you.

4. BEAT THE FEAR: Ask your customer what is holding them back from purchasing from you. Hyundai accepted vehicle returns if their customers lost their job during the recession of 2008. They gained market share and saw positive sales growth while other car manufacturers were going bankrupt.

5 NEW VALUE OFFERING: Look at how you can make your customer feel like the centre of the universe. Can you offer a lower cost item to your customer but still solve their problem and fulfill the same emotional desire? Can you sell what you are offering in a different fashion?

Even with a slower economy, companies still do want to increase their top line. At the very least, you can set yourself up for success during the upcoming growth phase by staying in touch with your customer, talking about the value you create, and tapping into your customers’ emotion.

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for the South Edmonton Business Association, the Fringe Festival, and Goodwill Industries of Alberta and donates blood at the Canadian Blood Services.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

 

Lose-Lose Relationship

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Everyone in Canada pretty much knows about the latest saga which is currently happening between our federal postal service, Canada Post, and its unionized postal delivery workers. At the time of writing this, the union was holding back from any labour disruptions…for at least a day.

The first labour disruption will involve the union workers not working any overtime hours in Alberta and the North West Territories. This arrangement will slowly roll out across the country. Per a radio interview that I heard, that amounts to just over one hour per week per postal delivery worker. Not a large disruption but it also makes you wonder why they have to work that much overtime over the whole system. That would be the subject for another few blogs since it is a pretty big topic.

I was talking to the postal delivery worker who is in charge of my community postal box last week. To say the least, she is not impressed since she does not know what is going on. As of Friday afternoon, the union had told her that they would be calling all workers Sunday night in regards to their work arrangement for Monday.

In talking to her, she said something that got me thinking. ‘This is a lose-lose situation. We are going to lose income while Canada Post is going to lose clients and revenue”. Currently, Canada Post delivers the last 5 kilometers of a packages’ travels for 66% of online transactions. Online retailers will need to look for alternatives or allow revenue to go to other retailers.

As in the case of many government policies, a labour disruption at Canada Post can be a disruptive event which will cause business to change their operations for long term sustainability.

Would a labour disruption at a postal service affect your company? How would you deal with it?

Have an awesome and productive week.

Kevin

Update as of September 6, 2016: Canada Post and the postal workers have come to a 2 year tentative agreement. Traditionally, they develop a 4 year agreement but the major issues were not fully dealt with. Hopefully, over the next 4 years, Canada Post and its union will be talking about solving their differences.

Update as of September 26, 2016: To my understanding, the vote still hasn’t been called by the union to see if the membership accepts the deal.

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting a workshop series known as Entrepreneurial Community Edmonton. The workshops cover different areas of business, including finance, human resources, and collections. You can find more information at http://www.l6sbc.ca/ecyeg.html

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

Why Lean: Safety

Reasons for Lean: Safety

Lean management is a great way to get a better handle of your operations. As someone that helps companies put their processes on a diet to make them more manageable, I have heard just about any and all reasons why a company wants to implement lean.

Reasons I have heard go from their key supplier or customer is doing it, or they heard it is a great way to save money. Personally, I would consider those to be a weak reason for implementing lean. If the right reason and the right culture is in place, your company can avoid being on the bad side of a lean implementation statistic. I have heard from a number of sources that 80% of companies that implement lean revert back to their old habits after 5 years.

Few think safety when implementing lean. Safety of your employees can be a beneficiary of lean.

Re-work: If the amount of re-work you have to do decreases, it decreases the opportunity for a repetitive injury.

Hazards: With lean, and particularly the 5S exercise, you have a home for everything. When hoses are hung up or ladders are properly placed, it decreases the chance of someone tripping or having something fall on them.

Movement: When you are evaluating your processes during a lean project, there are some steps or movements that could potentially hurt someone. The review allows the evaluation and possible change of those steps so future injuries can be avoided.

What reasons can you think about why you should implement lean? I will blog about the reasons why I think a company should implement lean….and it is not about profit.

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting a workshop series known as Entrepreneurial Community Edmonton. The workshops cover different areas of business, including finance, human resources, and collections. You can find more information at http://www.l6sbc.ca/ecyeg.html

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

Book Review: Five Key Principles of Corporate Performance Management

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As many of you know, I am constantly in learning mode. I am looking to learn the different perspectives of various items to not only help me, but my clients.

Recently, I finished reading ‘Five Key Principles of Corporate Performance Management’ by Bob Paladino. Mr Paladino is a specialist in helping companies to set up Corporate Performance Management offices (CPM). The CPM is a mechanism which can be used to link your corporate strategy, process improvement, and operations.

The strategic side of the CPM deals with the handling of the strategy map and the balance scorecard. The strategy map, as the name implies, maps out your strategy from the perspective of key operational processes to the higher level executive strategy. The balance scorecard is comprised of a set of Key Performance Indicators (KPI) for each step of the strategy map. Based off the two strategy tools, operational improvement projects are identified to be worked on.

Mr. Paladino takes the reader through a number of case studies of actual work he has done as an employee or consultant. It is much appreciated to see how all of these tools (Strategy Map, Balance Scorecard, Lean, and Six Sigma) are used together to help improve a company.

The concepts delivered from the book are great but the book is hard to read. Not because it is too technical but some examples lack certain pieces of information which will help to put the pictures together. In other portions of the book, there are some concepts which are revisited a number of times which make it hard to read due to boredom.

If you are a lover of strategy or process improvement, there are better books out there for you. If you are interested to learn how the two can be placed together, this might be the only book for you to read.

What is your most favorite business book?

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting a workshop series known as Entrepreneurial Community Edmonton. The workshops cover different areas of business, including finance, human resources, and collections. You can find more information at http://www.l6sbc.ca/ecyeg.html

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

That Long Stare

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Every once and a while, you wonder to yourself: ‘Why am I doing this?’; or ‘Why am I putting myself through all of these problems?’

Recently, I was asking myself those same questions. For a number of years, I have participated in the MS Leduc to Camrose Bike Tour which takes 1,500 to 2,000 bikers through a 178 kilometers bike ride to raise funds for the Multiple Sclerosis Society of Alberta.

This last tour was harder than most. Day 1 involved 40+ km/hr wind into our faces along with constant rain. For Day 2, the rain and wind eased up a bit but they were still a factor.

During Day 2, while finding my right knee acting up again, there was a bus parked at thesecond rest stop taking riders to the finish line.

I looked at that bus long and hard for a few minutes.  I kept hearing a voice in my head say ‘You have done it 14 other times, it is okay to give up now.’

In the end, one personal characteristics kicked in: not giving up. As a business owner, if you gave up easily, you wouldn’t be trying to fulfill your dreams. You wouldn’t be doing what you.

If your goal is worth working for; if your dream is worth playing out, don’t give up. The reward at the end will be more than worth it.  Success doesn’t come in 5 minutes. Hard work and hustle are needed.

Have you ever had that long stare at the bus? How did you deal with it?  I would love to hear.

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting a series of workshop called Entrepreneurial Community Edmonton #ECYEG with the goal of helping entrepreneurs with their business. You can find more information at www.l6sbc.ca/ecyeg

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867.

Is It Time to Start Now?

Thanks to the BusinessLink for the opportunity to write this blog a few weeks ago. You can find the original posting at:http://businesslink.ca/blog/now-time-start-business

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With the recent developments in the economic landscape, Albertans have experienced significant change. Companies have seen a decrease in sales and are right sizing their operations to be affordable, but yet meet the current demand. More than 70,000 Albertans have been affected by company restructuring and they are looking for their next opportunity.

In many cases, the next opportunity may lie in starting up their own business. But is it the right time? Everyone is cutting back.

A number of strong and vibrant companies started during an economic downturn. Microsoft, FedEx, Hyatt Hotels, and Smashburger are a part of a long list of companies that started during an economic downturn. Here are 5 suggestions on how you can make your startup a success.

Lean and Mean: Seeing that ‘times are tough’, your first priority should be to run your business within a strong and realistic budget. That skill will become valuable in the future.

Innovate: Are you stuck in a pattern of running your business the way you always have? This is the time to re-examine your strategies and processes.

Marketing: For many companies, their first reaction to a slowdown in sales is to cut their marketing budget. Look at this as an opportunity to get your message in front of your target market with less noise from the competition.

Relationships: Spend more time with your current clients and target market. Get to know them on a deeper level. Find out what their pinch points are and reverse engineer them.

Improvement: Listen to your customers and use that knowledge to improve your offerings. Maybe use that information to create a new product line or service offering?

Be realistic! Start a new product line because it is within your budget and it solves a problem for your target market. You have limited resources. Remember when you develop a new product or offering, you are taking resources away from your core product.

An economic downturn is a fruitful time to start up a new venture. This was my perspective when I started my business in the last recession of 2008-09. This is your opportunity to be open to new ways of thinking, and build on what you have.

Have an awesome week.

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (L6SBc.ca). L6S offers services in management consulting, Controller & CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting Entrepreneurial Community Edmonton, a series of workshops with the goal of helping business owners/managers with their company. For more information, please visit L6SBC.ca/ecyeg.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

Leadership Part 6 of 6

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Over the last 5 weeks, I went over 5 of the most common reasons why companies are not successful, according to the Small Business Administration of the United States. You will see that there are some common elements to each of the 6. Feel free to look at the original article here.

Leadership is one of those terms used in business which can be considered a catch all. It is the reason why a project progresses or fails, why a product launch is successful or not, or why a company fails or doesn’t. Lack of leadership is the number 1 reason why a company fails.

In saying this, you don’t have to be the most charismatic, the best speaker, or the most visionary person to be a leader of a company. I won’t go into much detail of what is considered to be a strong leader. I am sure that you can find at least 1,000,000 articles on this subject to help you. But in terms of leadership and the success of the company, how does it have an impact?

Vision: Setting a vision for a company can be a scary task for some people. What if you set goals for your company? Setting those goals becomes a building block to what can turn into your vision in the future. Without that goal or vision, where are you going to be going? It becomes even more important when you have employees. Would you follow someone who is walking about in the great outdoors not knowing where they are going or why they are going for a walk? This ties in to having uniqueness with your company.

Plan:  Now that you have your goals set out, how are you going to reach them? Do you want to offer the best customer service? How are you going to do that? Is it scalable for when you grow? Offering a new product and/or service and believing that it will go viral is not a plan. A local businessman believed that his company was going to go viral once his product or services hit the market. He had no plan on how it was going to happen. To make a long story short, the company is just now starting to get traction in the market place, but nothing near as expected. Don’t forget: develop a budget with your plan.  You don’t want a lack of financial management to be the reason your company does not survive. The development of the budget will help to ensure that the business model which you will be operating under will be sustainable. Lastly, the plan will help to manage your future growth.

Execution: You now have a goal which helps you understand where you want to go and develop a uniqueness with your customer. You have developed a plan (including a budget) which tells you how to get there. Now, it is to sticking to the plan, wherever possible, to attain your goals. That plan, of course, will have some bumps in the road and may require change, especially if you are well connected with your customers and you are receiving feedback that change is needed.

As you can see, leadership or the lack of it is a bi-product of the other top 6 reasons why a company does fail.

Where have you seen strong leadership take a company through dark times to a profitable place? Have you seen leadership being the root cause of a failure? I would love to hear.

Have an awesome week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting three social media workshops at 14920 Stony Plain Rd NW, Edmonton, AB T5P 3X8 (Pura Vida Mind Body Soul). The March 29, 2016 workshop will be about Facebook, April 26, 2016 will be about Twitter, while the May 24, 2016 workshop will be covering LinkedIn. All session run from 6.00pm to 8.30pm. Food and refreshments will be available. Contact Kevin to register.

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867.