SO TELL ME ABOUT YOUR REFERRAL PROCESS . . .

Now more than ever, referrals are a key component to business growth. The Referral of a Lifetime by Tim Templeton is one of the best books for referral partnerships.

In this book we are reminded of the power of referrals. Being given a referral means the referring party strongly endorses your product, your service and even you.  By the simple act of referring, the contact who referred you has given you a strong recommendation; therefore you are already viewed favorably.  Be mindful that people are more likely to believe what others say about you as compared to what you say about yourself. 

For someone to say that your company has amazing customer service has a much greater impact than you proclaiming that your service is amazing. It’s the essence of the third-party endorsement that gives you strength.

So how do you go about turning the wheels of the referral cycle?  I’d like you to consider Five components.   

Ask,  Educate,  Assure, Guide, Follow-up.

Ask for referrals.  People want to help you so don’t be afraid to ask for referrals. Take a look at your current list of contacts, clients and individuals in your circle of influence.  You have permission to ask for referral from individuals: (1) with whom you have a good relationship, (2) who know your work ethic and service levels, (3) who endorsed your product/service, (4) to whom you currently send referrals.  

Educate your referral sources. Do they know enough about you, you offer, and what constitutes a good referral?  Identify your “carrot” or buzz words that they can listen for as they interact with people, and share your “carrot” words with your referral sources.  Education can be provided any number of ways including informative newsletters, direct mail pieces, and one-on-one conversations.

Assure your referral sources. Pledge that you will always deliver top notch service and look out for the best interest of anyone they refer.  Prepare yourself for the occasion in which you might need to recommend another company if you are unable to meet the needs and expectations of your new referred contact.  Be sure to communicate back to the referring party to let them know what has transpired with their referral (ie, they hired you, purchased your product, recognized it wasn’t a good fit).

Guide your referral sources. Let them know how best to introduce new referrals to you so all parties have the greatest opportunity for success.  For example, you might ask your referral source to kindly: (1) provide you with the new contact’s name and telephone number, (2) let you know which of your products or services the contact has an interest, (3) position their contact to expect a follow up phone call from you.

Follow-up with your referral sources.  Let them know of your success or lack of success.  I believe this is the some overlooked aspect of the Referral Process.  It is always important to communicate back to your referral source and sometimes just say ’Thank You’.  This builds the bridge of Trust, and helps you further define your relationship with the referral partner.  But don’t forget that the referral process is a reciprocal process, if someone gives you an referral you must be mindful for the need of a future referral back to them.

The Referral Process

Many good (and bad) referrals are lost due to the referral process and how the referral is given to you.  I personally have given a number of referrals which simply indicated that I should call . . .  John Doe at 303.555.1212.  When I call John Doe, he knows nothing about me, is not expecting my call, and cannot believe that the referral source gave me his information.  Any referral given to you without following a process is nothing more than a Cold Call, and I hate Cold Calls. When giving a Referral Partner a lead, follow one of my three methods:

BEST-  Three-way meeting (coffee or meal) with the Referral Source and the Referral Candidate.  Nothing speaks better than having the Referral Source make a testimonial in front of you and the Referral Candidate.

BETTER-  Call and Virtual Introduction. Have the Referral Source call the Referral Candidate in advance and follow-up with a Virtual Introduction Email.  A Virtual Introduction would be as if you were introducing this person at a Chamber Meeting.  In the Virtual Introduction always include professional and personal information about each person, to derive commonality between these parties.

GOOD-  Call the Referral Candidate then follow-up later with another call.  Have the Referral Source call the Referral Candidate, with the necessary information about you and position that person accordingly so your call gets immediately taken.  Always follow-up with a ‘thank you’ (call or email) and report the results of the call.

5 WAYS TO LOSE GOOD CUSTOMERS

“The purpose of a business is to create a customer.”

- Peter Drucker

 
While this statement is true, it also serves to underscore the reality that one of the on-going purposes of a business is to keep a customer. No business owner would argue this point, but creating and maintaining quality customer relationships is often one of the biggest challenges facing businesses today.

Come Back Again

One of the many dangers to businesses is the tendency to become accustomed to having customers, to slip into a default mode of compliancy, assume that your customers are happy, that they will keep coming back, and they will tell others about you.  The problem here is that customers are people, and people thrive on relationships. And if we are not careful our customer relationships can become superficial and meaningless and they will find a new relationship.

No one wants to feel that they are being taken for granted and customers are no different. Customers are people and people must be related to, not processed. Simply “going through the motions” for your customers with the mindless expectation that they will always be there is a sure path to lose customers. An increasing factor in customer fickleness is the sheer volume of choices that are available in the marketplace. In many ways the business owner is not simply working to gain a customer’s business, but is actually engaged in a contest to win the hearts and trust of the customer.

5 Ways to Drive Business Away

There are certain clichés in business that are dubious in their truth, such as “the customer is always right.” But one that is undoubtedly true is that it is cheaper to keep an old customer than to find a new one. With this in mind let’s look at some of the most common mistakes businesses make in this arena:

1-    Ignore Your Customers. This cardinal sin can be achieved in person, on the phone, and over the Internet. Many retail companies adopt a “10 Foot Rule” that requires customers to be acknowledged if the employee is within ten feet of them. Greeters at the door are not only good for Wal-Mart, and acknowledging customers by answering phones quickly and with a smile is just good business.

2-    Make it Difficult to do Business With You. Customers should not have to work at giving you their money. And they should not have a fight on their hands if they need to return your product or are unhappy with your service. If you make it hard on your customers, your competitors are always willing to go the extra mile for them.

3-    Display a Lack of Integrity. Whether this is your staff making excuses for poor service or products, or engaging in sales or marketing practices that could be deceptive, being a trusted and reliable business is essential. No one likes being dealt with in a way that is less than honest.

4-    Become Dull and Predictable. This does not mean sacrificing reliability and standards of quality and excellence.  Your customers expect innovation. Customers are stirred by positive surprises, just because your business may be old and dated does not mean it has to look and act like that.

5-    Don’t Listen to Your Customers. We live in an age where product and company reviews (positive and negative) posted on the Internet have a very long shelf life. Therefore, it is critical for you to hear what your customers are saying and respond appropriately. This can also mean reviewing blogs, doing market research and talking to your customers.

Our clients regularly met with their entire staff to discuss customer questions, tips and best practices, and to elicit ideas for innovations and improvements to the services and products. The synergy of bringing together the “frontline” employees with the management team with a focus on their customers works to create an atmosphere and company culture that is customer-centric and service oriented.

What a Customer Wants

While the customer may not always be right, there is one cliché that cannot be discounted or ignored: The customer rules. And this means that the needs, wants and desires of your customers must come first in developing the processes and procedures of your Client Fulfillment Experience.

For some businesses this means making regular and on-going efforts to “listen” to their customers: What do they like about your business? What do they like about your products? What do they like about your service? What is that they do not like?

Communication is vital and this implies intentionality and strategy on the part of the business owner. For others it will mean taking pains to create a customer-centric business model: one that takes into account the importance of the customer and recognizes that the product or the brand is not the focus.

Today’s business world is continually introducing technology and forums that allow you to not only engage your customers and prospects, but to keep your finger on the “pulse” of your customer base. Start today and continually win the hearts and loyalty of your customers.

HAVING TROUBLE WRITING HELP WANTED ADS?

One of my clients, a chiropractor, recently decided it was time to hire an Administrative Assistant for his growing business. When it came time to announce the job, I asked him to send me the ad first so we could review what he’d come up with. Here’s what the ad said:

So, will this ad work? Yes it did because he got responses, in fact he got over 100 responses.

Did he get the right responses?

He could hire many of the applicants who are capable of typing medical reports and so on, but there's nothing about this ad that speaks to the personality of his company or his ideal candidate. Therefore, he’s going to have to waste time and resources reading resumes and interviewing people to find the right employee. This means spending unnecessary money, and that means a hit to his bottom line.

Now, anyone who’s ever written a job description for the purpose of hiring a new employee knows that it’s no piece of cake. Even if you think you have the job function properly outlined, it can be challenging to get it right. We suggest to all of our clients that once you’ve made the decision to hire, take your time. Finding the right people is the most important expenditure you can make, when including the time and money it takes to recruit the right people.

Use a Marketing Approach

We encourage our client’s to approach recruiting as another aspect of marketing and lead generation. This is due to the fact that finding the right employees for your company is like finding the right customers, the same principles apply to the recruiting process. You’ve got a product you want to sell (employment in your company) and you need to generate “leads” (applicants) that you can eventually convert into “customers” (new employees).

First, consider these items:

• What is the product you are selling? In other words, what is the idea behind your business? We like to call it “the game worth playing.” What makes your product (the business) unique? What sets you apart from the competition in the eyes of potential employees?
• What are the specifics of the job? Define the results you want the position to deliver and responsibilities expected of the position. 
• Who is the customer for this product? Who is the ideal candidate for this position? What personality traits will the right person have to fit into the company culture? You need to identify the perfect person for the job so that when they walk through the door, you’re ready. 
• What personality are you looking for? Someone who is gregarious or introverted? Do you need somebody capable of multi-tasking or somebody with laser-like focus?
• Where are the customers (geographically)? Is this a telecommuting position? Is this an onsite position? What’s the acceptable radius for an onsite employee?
• What message will attract them? If you’ve defined everything above, you should be able to determine what message will attract the ideal person you’re looking for.
• What channel will best reach them? Where you place your ad will make a huge difference. Is it appropriate for Craig’s List, Careerbuilder.com, the newspaper, or LinkedIn? Again, your research into the ideal customer should inform where you can reach them best.

One of the ways to differentiate your recruitment ad is to have the ad carry the promise of emotional gratification. By giving your ads some emotional appeal, you will attract better candidates because not only will they be technically qualified, but they will likely be nice people that desire to work with nice people! 

My client placed a new ad with something like this, and found his 'perfect' employee.

WHAT HATS ARE YOU WEARING?

A few years back I watched a movie called The Stepfather. Until the final five minutes of gore, it’s a wonderfully constructed psychological thriller. The title character is a man who is forever searching to fulfill his vision of the perfect family; the house in the suburbs, the wonderful child and loving spouse. He wanders from town to town, putting himself into households as the ‘ideal’ second husband and father. He creates in his mind the picture of the perfect family, then goes into violent meltdown when his ‘families’ don't match the movie in his head.

There is a pivotal scene in which one of his current wives catches him in a lie. They're in the kitchen, and he's called her by another wife's name. "What did you say, John?"  she asks.

The camera shows John's face in the foreground, his "wife" in the background. We see the look in his face, the eyes darting right, and then left. He says, more to himself than to her, "Wait a minute. Who am I here?"

For many business owners, this feeling of ‘disconnect’ is much the same, which is why, unless you own a restaurant, you should not leave sharp objects laying around.

Who Am I?

We make strong distinctions between being an Entrepreneur, a Manager, and a Technician. Each role within a business requires a different hat. We conclude that:

·       The Entrepreneur creates the Vision.

·       The Manager creates the Systems.

·       The Technician creates the Results.

Our clients in our Executive Mentoring Programs are challenged to examine the hats they wear in their business and the value of each. All business owners have qualities of each, but where they most often lack confidence or expertise is in that of The Manager. Most businesses are started by technicians suffering from an ‘Entrepreneurial Seizure’. Being a manager doesn’t even come up in that scenario. Invariably, a business owner will conclude: "What I really need to do is to hire a Manager."

What a Manager Needs to Be

An effective manager has the potential to take on some of the accountabilities that command so much of your time. But how is this really going to move your Vision any closer to reality?

In the development stage of your business, they are all your hats to wear. You must be able to look at your business from each of the three distinctive points of view. As ‘The Entrepreneur’, you have the sole authority and responsibility to determine the direction of the business. How will the business be positioned in the world; in the eyes of its customers, employees, lenders, vendors and the larger community? The Entrepreneur must determine and constantly reinforce the company's Intention.  The Entrepreneur's Vision is The Manager's marching orders; the Vision is the gold standard. The Manager's duty is to enforce and manifest the Vision.

Ultimately, managerial work bridges the space between the entrepreneur's Vision for the company and the daily technical efforts moving the business toward that Vision. Effective managers, those who can motivate employees to reach their full potential, are instrumental in building turnkey, systems-dependent businesses.

What a Manager Needs To Do

A Manager must have several critical characteristics one is ‘know-how’. Some managers arrive with some ‘know-how’ intact (knowing what to do and how to do it) getting work done through other people (Technicians). At a minimum, effective managers will have the ability to find out how to do that. Knowing how or knowing how to find out how is one of the minimum required skills of a successful Manager.

The other essential characteristic of a successful Manager is the ability to transform that know-how into processes and systems that will enable people to get the desired results. The only effective processes and systems are those that will achieve the Entrepreneur's Vision. Those processes and systems are the tools the Technicians use to get the results that fulfill the Vision. The Manager does not manage people. The Manager manages systems. People are virtually un-manageable, while systems are not.  People respond to orchestrated patterns and within those patterns (systems and processes), people can manage themselves!

An effective business must begin with the Vision. The effective Entrepreneur creates a compelling Vision and infuses it throughout the entire organization. The effective Entrepreneur lives the Vision. The effective Manager translates that Vision into systems, and delegates the tasks to the Technician. The effective Technician operates within the system to create the results that move the Vision forward.

Conclusion

A successful business owner does not wear all the hats at once. The owner of a successful business must practice the art of discrimination. Our clients know what hat is appropriate at any given moment, what characteristics are essential when wearing that hat, and when it is time to pass it off. 

YOUR PROMISE?

It started because my twin 16-year-old sons had outgrown the length of their twin beds. They needed a longer, larger mattress and box spring set. We thought we needed a full mattress, but we did our research and discovered that while a full mattress is wider than a twin, it is not longer. A queen size, on the other hand, is wider and longer. Therefore, we needed two queen-sized beds.

Free Delivery and Set Up

We checked local ads and found a place that made this promise: "We will deliver, set up, and take away your old mattress." Sounds good to us. So we went to the retail store and settled on a set that was not too hard and not too soft and, thankfully, on sale. In other words: just right for both of us.

We placed our order with the salesperson and were informed that they would be by between 5:00 and 5:30 pm on the following Friday to deliver the new beds.

We cleared a path to their upstairs rooms, removing mirrors and pictures on the stairway wall. My sons managed to rake away enough of their teenage “stuff” to allow a bed-sized footprint for the delivery crew.

On Friday, the delivery truck arrived (on time) as promised. We showed them the path up to their rooms. One guy carried up the boxes containing the metal frames. Then they brought in the mattresses. It was a tight squeeze between the stairway railing and the first landing, but mattresses bend. They got them into their rooms and went back for the box springs. The problem with box springs, by their nature, is that they are designed not to bend. And in fact, no matter how the workmen tipped, repositioned or approached the problem, the box spring just could not be made to clear the gap between the ceiling, landing and railing.

After 10 minutes of trial and error, it became clear that the box springs would not make it up the stairs unless the railing was removed. They stared at me, then exchanging a glance passed between themselves. Then, they carefully set the box springs down on its’ edge against the living room couch. The driver handed me the receipt and the warranty . . . and left! They left!! They left me with two queen-sized box spring sets leaning against my couch in my living room, two mattresses leaning against the wall in their bedrooms, and two metal frame assembly sitting in its’ box … all waiting for ME!

Set Up?

I suppose you could say that the store kept its promise: "We will deliver, set up, and take away your old mattress." They did take away the old mattress. They did deliver the parts. And, they left me feeling . . . Set Up! Three hours later, with a collection of all the wrong tools, and the twin’s help, we had the railing off. A neighbor helped me wrestle the bed upstairs. Then, my twins assembled their frames. 

We were still very heated about this entire experience, and we concluded that the delivery guys were a reflection of the culture of the store. In the end, the owner made some lame excuses, and pointed out some fine print in the agreement.  The bottom line was . . . What was the level of customer satisfaction?

As we teach in our Executive Mentoring Programs, every complaint is an opportunity for improvement, and in this case the owner really missed this opportunity. The bottom line was that I just didn't care if they improved or not. They had their one and only chance to make me a satisfied customer instead of just a sale, and they blew this opportunity.

Four Areas of Focus in Client Fulfillment

There are really four areas to consider in bringing maximum value to your customer.

1- Product Design and Strategy: Do your products do what you promise they'll do? Are they designed with your customers' needs in mind?

2- Production Process: No matter what you produce: beds, donuts, career counseling, financial services, accounting, remodeled kitchens, or tai chi training--it must be of the highest quality and orchestrated to minimize cost.

3- Delivery Process: Your delivery process is equally the physical transfer of your product or service to the customer and the experience your customer has at the time of this transfer. This is more than a hand-off and a signature. This is the critical point at which your customer must feel the BEST about the decision that's been made.

4- Customer Service: This is free. This enhances the main offer. This is where you have your most critical competitive advantage. It could be additional information, follow-up assistance, advice, upgrades, credit assistance or a hyper-responsive complaints department.

Conclusion

The only way to assure that your clients are getting exactly what it is they need each and every time, is to create a system to deliver it. No promise is more important to keep than the one you make to your customers about your products or services. If you don't deliver on this promise, no marketing strategy or sales technique will keep your customers coming back. You have to prove that you're paying attention to their needs and that they can expect you to give them what they want.

The 7 Deadly Signs to a Business Owner

“I cannot imagine any condition which would cause a ship to founder. I cannot conceive of any vital disaster happening to this vessel. Modern ship building has gone beyond that.” 

 – Captain Edward J. Smith, HMS Titanic

When navigating through dangerous waters a wise captain keeps an eye on certain signs. But what if you had never charted your way through rough stretches before? It’s been said that a smart man/woman is one that learns from his/her mistakes--a wise man/woman learns from other people’s mistakes.  A truly wise man surrounds himself/ herself with a business mentor and coach to give them:  focus, clarity, results and growth.  There are a few certain things every business owner must be diligently aware of.

Don’t be a Captain Smith

On April 15, 1912 the HMS Titanic sank in the early morning darkness after having struck an iceberg two and half hours prior. Tragically, 1,517 people perished.  Unfortunately, very few lifeboats were filled to maximum capacity when they were lowered from the Titanic into the icy water. This caused the death toll to rise dramatically. When the order came from Captain Smith to commence loading the lifeboats, the Titanic's officers were probably unaware of the magnitude of the situation. Their apparent complacency did not instill a sense of urgency in the passengers and therefore caused many of them to balk at the opportunity to get into a lifeboat.

In retrospect it has been easy to see that many signs were ignored, dismissed, or simply regarded with a cursory acknowledgment. While your business certainly does not compare with an ocean liner, the same unfortunate results could occur from a combination of ill-preparedness, complacency and the inability to recognize and appreciate the danger signs.

The twin dangers evident in the Titanic disaster were ignorance (or lack of knowledge) and presumptuousness. Key players in charge of the ship were either woefully ill-equipped to see and recognize the danger signs, or were overly confident that nothing of that magnitude could happen to “their” ship. While we trust that most business owners are wise enough to know that their “ships” are not unsinkable, not every owner is necessarily aware or knowledgeable of what danger signs to watch for.

The Seven Deadly Signs

1- You don’t know where your next sale is coming from.

Having a consistent and reliable flow of customers and sales is essential for the health and growth of any business. Marketing and lead generation must be effective and on-going in order to provide the flow of sales, current and future, needed for planning and for implementing strategy.

2- Your employees are unhappy or demoralized.

The culture, environment and atmosphere of your business will have a direct impact on your customers by way of client fulfillment, customer service, and overall productivity and quality. Unhappy and demoralized staff will not perform to the standards you want and this will have a tangible effect.

3- You feel like you can never be away or take a vacation.

If the functioning of your business is wholly dependent on you and your presence, it will never grow further than that. You must have an effective management component in place to free you from your business enough to have a life outside of the business.

4- You are losing more customers than you are gaining.

It doesn’t take a rocket scientist to determine that if you are consistently losing more customers than you are making it is simply a matter of time before you have less customers than you need to break even. And if that trend continues you will be taking on water – or red ink!

5- The company’s objectives are not clearly defined to your employees.

This is a bit more insidious but still critical sign of trouble. Imagine a soccer team where none of the players know what the team was trying to accomplish. It’s not enough to simply “do your job” – everyone needs to know the vision, the strategy for getting there, and how they fit in with it all.

6- Your business is constantly in a “survival” mode.

This can actually be a combination of signs and symptoms, but the general sense of it is easily recognized and can be deadly for a business owner. The daily onslaught of unpaid vendors, outstanding receivables and lack of sales can grind away at you and take the wind out of your sails.

7- The passion is gone and you dread going to work every day.

A loss of passion can be attributed to any number of things, but is usually a result of the combined toll of many of the signs listed above. It could be argued that a business owner who has no passion for what he or she is doing is on a fast-track to “jumping ship”.

IS BIGGER REALLY BETTER?

“All growth is good.”

“Bigger is better.”

“All businesses must either grow or die.”

If you’re a business owner all these mantras are true, because this is what you have always been taught. And in fact, these popular business mantras are routinely published in the Wall Street, at business schools, and by some of the most well-respected business consultants. But according to Professor Ed Hess, these “truths” are anything but.

“At best those beliefs are half-truths and at worst they’re pure fiction,” says Hess, author of the new book Grow to Greatness: Smart Growth for Entrepreneurial Businesses. “Growth can be good and growth can be bad. Bigger can be good and bigger can be bad.”

Grow or Die is a belief that has no basis in business reality. In fact when not carefully managed, growth can destroy value as it outstrips a company’s managerial capacity, processes, quality, and financial controls, financial resources (cash flow), or dilutes your customer value proposition.

The best example of this was between 2005 and 2007, when Starbucks aggressively opened new store locations and made several operational changes that diluted its customer value proposition, diluted its high employee engagement culture, violated its real estate site selection controls, and weakened its’ high value-added ‘experience’ business model.

Improve or Die

Instead of grow or die, the mantra should be changed to: Improve or Die. Every business and business owner must continually improve its’ customer value proposition (or Unique Sales Proposition) better than the competition in order to stay viable.  Understand that this is where truly successful and profitable business operate.

Understand that growth is change (and change isn’t always easy). However, there are limits to an individual’s and an organization’s ability to process change. Growth requires the entrepreneur to install more processes, procedures, controls, and measurement systems. The right processes and controls must be put in place and taught to employees. In addition, the right information needs to reach the manager regarding variances from processes and controls so mistakes can be fixed quickly and do not escalate into a larger problem.

Evolution

Growth requires the evolution of the entrepreneur and the management team and more sophisticated processes and controls. Often, if not always, the business model and customer value proposition evolve, too. Furthermore, this evolution is continuous, and anticipating and responding to it can require making some fairly dramatic (and difficult) changes.

“One surprising finding of my research was that companies frequently had to upgrade their management teams as they grew,” explains Hess. “Often managers who operated effectively at one revenue level of the business were unable to manage effectively at a much higher revenue level. The jobs simply outgrew their skills.”

Learning

Therefore, growth also requires continuous learning and constant improvement. The entrepreneur and employees must be constantly open to learning and adapting and improving in an incremental manner. No matter how big you get or want to get, continuous improvement is required.

Resources

Every entrepreneur has limited resources and time, to be successful, therefore businesses must prioritize their focus. This is critical because any growing business has resource constraints: limited people, time, and capital. So it is critical that the entrepreneur spend his or her time focused on the most important areas that can drive success.

Control

Growth requires implementing processes, which include controls. Processes are like recipes for baking a cake. They are the step-by-step instructions for how to do a task. Processes are necessary to hire employees and train them, to minimize mistakes and institutionalize quality standards, and to deliver products and services on time, 99 percent defect-free. Controls are necessary to set boundaries on allowable behavior and also alert management to deviations from processes.

Space

To get a better handle on growth risks, consider how your strategic space will change as you get bigger. You will probably enter a new competitive space, facing bigger and better competitors than you previously faced. Those new competitors may be better capitalized than you and be able to engage in price competition, driving down your margins.

Conclusion

Respect growth, carefully consider the timing and whether you have the right people, processes, and controls in place to manage the growth. When you approach growth carefully, you can take your business to greater and greater heights.