Pretending it’s new

When some leaders wake up to reality, when they slowly start to notice that things are in fact meaningfully different from how they were before, we often witness a self-absorbed, I’ve just found Jesus and I need to tell you all about it, kind of thing take over.

“Consumers who shop multiple channels are more valuable than single channel customers” they breathlessly announce at conferences.

“Stop thinking about e-commerce as a channel” becomes the title of a newly released white-paper.

“We need to differentiate ourselves on experience” the CEO implores a group of assembled executives.

Suddenly everything is about “seamless”and “omni-channel” and “the single view of the customer.”  Their sentences start to include a disquieting use of “integration”, “customer-centric” and “relevance.” Investor presentations and annual reports turn into games of buzz-word bingo.

I hate to drag you out of your pink cloud, but just because you took a long time to notice, doesn’t mean it’s a recent phenomenon. Responding energetically to a totally foreseeable crisis does not make you a great leader.

Pretending it’s new may prop up our ego or cast ourselves in a better light. Better late than never, huh?

Pretending it’s new may buy ourselves some time with a less than savvy Board. What they don’t know can’t hurt them, right?

Much of what passes for insight today has in fact been known for years if only we had taken the time to become aware, confront its import and accept the implications. It’s not new and we shouldn’t pretend it is. Of course, neither is this.

Now obviously we can’t go back and fix all the should of’s and could have’s.

But we can ask ourselves what of potential importance might we be missing right now?

We can go into understanding what our fear causes us to avoid.

We can accept that often our pretending creates the illusion of keeping us safe.

The drip method of irrelevance

At first, the shift is almost imperceptible.

With quarterly earnings expectations to hit, we tell ourselves we can easily save a few bucks by automating some of our customer service functions. Or perhaps it’s through simplifying our organizational structure or eliminating “non-essential” positions. Better yet, let’s close some “unproductive” stores.

And obviously technology enables us to take away a bit of decision-making from the front-line staff. After all, human beings are notoriously misled by their own intuition. And whoever got fired for praying to the God of Efficiency?

And running all those different marketing campaigns adds a lot of complexity. It would be much easier to boil things down to just the major stuff that we know moves the dial.

And our product line is just too diverse. Sure it’s interesting to have something fresh and innovative, but doesn’t that just increase the risk of slowing down inventory turnover and increasing markdowns? Safe is smart right?

Of course, over time, the top-line stops growing and the only way we know how to drive profits is through cost-cutting.

Over time, we’re proud of our low average talk times, yet customers can’t speak to a human being and our Net Promoter Scores continue their inexorable decline.

Over time, our one-size-fits-all marketing is, at best, indistinguishable from the competition and, at worst, a dim signal amidst all the noise.

Over time, the sad reality is that all we sell is average products for average people and there’s no reason to pick us over the guy with the lowest price.

Sears, RadioShack and a host of others that are on a long inevitable march to the retail graveyard didn’t get trumped by a disruptive competitor that emerged out of nowhere. An oppressive government didn’t regulate them out of business. They weren’t crippled by a series of specious lawsuits or hobbled by natural disasters.

Usually the brands that become irrelevant have made hundreds of seemingly small decisions, over many years, that prioritized the short-term ahead of the long-term, the numbers instead of the customer, mass rather than personal, safe not remarkable.

And once they are gone, once their fate is sealed and their previously storied histories are part of the record, we’ll look back and realize it happened gradually, then suddenly.

The problem with saying “no”

During the past 25 years Sears had at least three opportunities to transform itself by entering the home improvement warehouse business (I worked on two of them). This was probably the only way Sears was going to ultimately survive and unlock the value of its franchise Kenmore and Craftsman brands. Each time the answer was “no.”

When I headed up strategy at the Neiman Marcus Group (2004-08), we evaluated building a leadership position in omni-channel by consolidating our disparate inventory systems, we recommended moving from a channel centric marketing organization to a customer and brand focused one, we proposed aggressively expanding our off-price format and, having understood the share lost to competitors like Nordstrom, we analyzed improvements to our merchandising and service models to become a bit more accessible. Ultimately we said “no” to moving ahead on all of these. Years later, these strategies were ultimately resurrected. But the opportunity to establish and extend a leadership position may have been lost.

Obviously there are plenty of times when either the smart or moral thing to do is to say ‘no.” Obviously it’s easy to look back and say “I told you so.”

Yet systemically, most organizations are set up to reward the status quo (often cost containment and driving incremental improvement) and punish the well intended experiment. So it’s easy to say “yes” to the historically tried and true and “no” to just about everything else.

Of course we don’t have to look very hard to come up with brands that have been struggling for many, many years (Sears, JC Penney, Radio Shack) or have completely imploded (Borders, Blockbuster, etc.). All of these said “no’ to any number of potentially game-changing strategies along the way. Care to hazard a guess at how many long-term Board Members of these perennial laggards and outright losers got pushed out for saying grace over a series of crippling “no’s”? How many CEO’s had their compensation whacked for never missing an opportunity to miss an opportunity?

In a world where change is coming at us faster and faster, we need to be challenged just as much on what we are saying ‘no” to as we are on what gets a “yes.”

And If you think there is always time to fix the wrong “no” decision, you might want to think again.

Learning to surf

There are a few different ways people approach the ocean.

Some dive right in.

Others inch in slowly, testing the temperature of the water until they feel comfortable to wade in all the way.

A few like to stand there and get pummeled by the water’s force.

And of course there are those that avoid going to the beach entirely.

The most daring and remarkable of all are the surfers.

The surfer harnesses the ocean’s power, gliding above the surface, zigzagging their way to the shore. Of course, sometimes they fall off their board. But the good ones understand this is just part of the process and hop right back on. They know that through practice they will navigate the inevitable ebbs and flows, the unexpected surge, the occasional fellow competitor that gets too close. Over time, they spend more time up on the board, reaching the shore faster with far more grace and power then when they started.

They understand and accept a few things we all should.

Avoiding turbulent water is impossible.

Fighting the power of the ocean is an exercise in futility.

Waves are inevitable.

We’re going to have to learn how to surf.

HT to Jack Kornfield for the inspiration

You know what’s hard?

Customers say they want a more seamless experience across all channels and touch-points. “Sure” you say, “but it’s very expensive and complicated to implement that level of integration.”

Silo-ed data, systems, organizations and metrics are keeping your brand from being more customer-centric and relevant. “I know” is your response, “but greater centralization would be very jarring to our culture.”

In an increasingly noisy world, mass marketing and one-size-fits-all approaches fail to gain share of attention, becoming less effective by the day. You respond, “you’re right, but treating different customers differently is difficult to scale.”

Relentless price promotions and layering of discounts and reward points deteriorate profit margins, teach customers to only buy on sale and accelerate an inevitable race to the bottom. Your defense is to say “well that’s what moves the top line” and to point out how hard it is to justify full price.

In the inevitable battle between denial, defending the status quo and rationalization vs. acceptance, leaping and innovation, we tend to choose the former. And our fate is sealed.

Many of the things we avoid as too risky are, in fact, often just the opposite. The risk is in the failure to change, in the lack of passion to become intensely relevant, in being stuck in “me too” instead of choosing to become remarkably different.

What’s hard is to move where the customer is headed after the competition has already established a beach head.

What’s hard is to break through the clutter with undifferentiated products and tired messaging.

What’s hard is to acquire, grow and retain the right customers with average products for average people.

What’s hard is to catch up when you’ve fallen behind.

Mass or built for me?

All about price, or all about unique value?

Average or remarkable?

My guess is that every brand that’s gone through the work of closing stores, firing people and liquidating inventory might have a different view of what’s hard.

Not quite my tempo

Every individual has a pace at which they prefer to work. Of course it can vary given the circumstances. We can pick up the tempo in a crisis, or slow down when faced with uncertainty. But there is a rhythm that feels most natural to us and, often, folks that consistently work faster or slower than we do can frustrate us.

Organizations are similar. Some are constantly on the balls of their feet, poised for action, working briskly through issues, taking risks, experimenting. When a new opportunity arises, they are ready to pounce. They’re passionate–and in a hurry–to be part of the next big thing.

Others are at the other end of the spectrum. They sit back and observe. They are cautious, timid even, moving deliberately to scope the situation out. They’re more afraid to make a mistake than to fall behind. They constantly need to be pushed into making any meaningful change.

There are problems with going too fast, just as there can be issues with going too slow. This clip from Whiplash brilliantly illustrates that one challenge is knowing and accepting your tempo.

In case you haven’t notice, the pace of innovation is accelerating. Customer expectations are being transformed, seemingly overnight. Whole industries are being disrupted like never before.

Which is why it’s a good time for a tempo check.

And when in doubt, it’s probably better to rush, than drag.

The unexpected virtue of ignorance

“In the beginner’s mind there are many possibilities, but in the expert’s there are few.”

Shunryu SuzukiZen Mind, Beginner’s Mind

If you are flying my plane, performing my surgery or repairing my car, I want you to have a darn good grasp of the details. True knowledge reigns supreme.

Before you deny rights to others–or steadfastly attempt to impose your opinions–you probably should be well versed in the facts. Ignorance is not bliss when it comes to how we treat each other.

But in a world where large and mounting problems linger, too often it seems as if all our experience isn’t helping very much. In fact, in the business world, it’s not hard to name dozens of once powerful brands that lost their mantle to inexperienced upstarts.

While the experts were all saying it couldn’t be done, the ignorant entrepreneur was out there doing it.

Once we tell ourselves we know what works, once we hear ourselves saying “we tried that before and it didn’t work”, once we have something we’re afraid to give up, the trouble begins.

And the door is opened to someone who doesn’t know any better.