"Touch, Pause, Engage" - a lesson for business from Rugby Union

With the Rugby Union World Cup this year in Japan, I thought that a blog entry with a rugby flavor would be appropriate.

"I prefer rugby to soccer. I enjoy the violence in rugby, except when they start biting each other's ears off." - Elizabeth Taylor (1972)

In the game of Rugby Union, play is restarted after a minor infraction by a scrum. During the scrum the forward pack of 8 players will engage with their opposing pack to win the ball. These forward packs weigh close to 2000 lbs (~ 900 kgs), and so these scrums are a test of power and strength of these players, as they compete to win the ball back for their teams.  Before 2007, there were not may rules around how these packs engaged, resulting in many serious spinal injuries due to collapsed scums, and the violence of the contact. In 2007, the rule changed to require that each pack 'crouch', 'touch', and 'pause', before they 'engage', as the referee calls these instructions out.  Crouching allows the packs to correctly 'bind' and set up for the scrum. At 'touch', the front row players reach out and touch the opposing line - this ensures that they are at the correct distance before engaging.  'Pause' ensures that they wait for referee to control when the packs engage.


How does this translate to your business?  We all love sports analogies, and so I am suggesting this rugby analogy to help you with your next Business Planning cycle.  The three phases of strategic Marketing Plan are Analyze, Plan and Execute.  And so this example from the sport of Rugby provides a framework around which you can build a Marketing Strategy for engaging your competition.


Touch/ Analyze

• Know your market and your competition's products/ services, pricing arrangements and terms, promotional campaigns, people and organization. 

• Gather feedback from customers, partners and others in your sales teams.  Know the opposition's 'weight' in your market.

• Know the gap between you and your competitors.  What differentiates you? What are your relative strengths and weaknesses?

Pause/ Plan

• Develop a strategy and tactical plan for engaging with your competition.

• Assess risks and opportunities in the competitive environment.

• Make sure that your team is prepared and aligned on your plan. Align individual targets your market strategy.  Is the team well 'bound', and set to execute?

Engage/ Execute

• Execute the plan as a team.

• Adjust on the fly to remain aligned with your strategic objectives.

• Win the ball!

Engage!

Assess your Business

"Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win."

Sun-tzu (~400 BC), The Art of War. Strategic Assessments

Businesses need to step back and assess how they are performing against plan and how to get to the next level. You need to take the time to step away from the business and look at the basics. Do your business numbers make sense?

Review your Market

• Which markets, or market segments, are most profitable?
• What plans do you need to attack new markets?
• Are existing markets saturated?
• Who makes up your markets
• Are your existing marketing methods right?
• How much do they cost?
• How do you target potential new customers?

Review your Products & Services

• Which are the most profitable? Why?
• Which are the least profitable? Why?
• Do you understand your how your product/ customer mix affects your company profitibility?
• What issues do you have around price, service and quality?

Your competition

• Who are they?
• What are their strengths and weaknesses?
• How do customers compare you and your competitors?

Assess your business performance.

• How does your cashflow forecasting system work? Is it accurate?
• What about your profit forecasts - do you keep them up to date and monitor performance?
• Do you maintain tight budgetary control on financial matters?

Your suppliers

• What are relationships like?
• Do you work with them to improve their quality of supply to your business - and thus to your customers?

Assess People

• Do you have the right people to achieve your business objectives?
• Do they know what is expected from them in achieving those objectives?
• Do you operate a training and development plan?
• What are their strengths and weaknesses of your management team?

Assess Yourself

• Do you know your own strengths and weaknesses?
• Do you need training?

Assess Your Infrastructure

• Will your premises cope with your plans?
• Are they used to best effect?
• Is your equipment up to date?

How will you find any improvements?

The 14 Commandments of Creating a "Wealth Pulling" Niche!

The person who finds or creates a special niche, gets the cream of our societies financial rewards. Whether you're Bill Gates or Joe Average.

To out-niche your competitors you must focus on these "14 commandments" of niche creation at all times. Observe the ones you apply to your business, product, or service - and watch your sales soar.

1."The Principle of Adaptation" - The simplest way to create a new idea is to do what others in another business or industry are doing. Next, see if you can adapt it to your own business, product, or service.

2. "The Principle of Addition" - Can you add something extra to your product or service that your competition doesn't have or isn't doing?

3. "The Principle of Combination" - "What positive elements can you combine from another product or service to make yours better?" A candy bar did it with simple peanut butter and chocolate, and made a successful new product. So can you.

4. "The Principle of Customization" - Can you find little ways to personalize a part of your product or service? That's a quick, easy, and cheap way to create niches. Can you make your product or service more personal and less cookie cutter?

5. "The Principle of Ease and Convenience" - Can you find more ways to make your product or service easier and more convenient to buy, use, or own? Then you'll have a strong niche.

6. "The Principle of Elimination" - What negative or inconvenience can you eliminate for your customer, with your product or service. People not only pay for more they'll pay for less. Less irritations, less waiting, less inconveniences.

7. "The Principle of Enlargement" - Do people like your service or product? Then it's a sure-fire bet there is a segment of your market that would like even more of it. Can you super-size something?

8. "The Principle of Entertainment" - From cradle to grave, we all have this inner urge to be entertained, amused, or fascinated - especially before we spend our money. A relaxed customer spends more. Find little ways to amuse customers before, while, or after they buy your product or service.

9. "The Principle of Longevity" - It's making some feature of your product or service last longer. It can also include making a positive experience or feeling last longer. If you can do either, you will have a niche that's hard to match.

10. "The Principle of Portability" - People hate to be tied down. So, if your product allows people the freedom to use your product or service in more than one place, that's a powerful niche.

11. "The Principle of Reduction" - If you sell a product or service, is there any way to reduce a certain feature to make it more convenient? More portable? Or easier to use? Can you reduce it and make it more affordable for another type of customer?

12. "The Principle of Reversal" - Look at what features or services your competition is offering or not offering and reverse them. If they close on weekends, can you be open? If they cater to seniors, target more young people. Or if they cater to high-end customers, target more low-end volume customers etc? The list is endless.

13. "The Principle of Safety" - If you can show others how your product or service can add safety or reduce risk, you'd have a powerful niche. People hate to experience loss, feel insecure, or waste money. Try to think of little ways you can help people avoid the above with your product or service.

14. "The Principle of Speed" - You should always be thinking, "What can I do faster than my competitors-without reducing quality?" Can you fill your orders faster? Can you give faster service? Can your product get faster results? Can you resolve customer issues faster? Think speed!

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REFERENCE: Business Know-How

Failure is the Mother of Innovation

"Failure is our most important product. "
R.W. JOHNSON, FORMER CEO, JOHNSON & JOHNSON

It is amazing how many innovative and visionary companies have grown, not out of detailed strategic planning, but rather by trail and error. By stumbling onto a great opportunity by accident.

Johnson & Johnson started their business back in 1890 as a supplier of antiseptic gauze. Because of complaints that this gauze caused skin irritation with some patients, they started sending a small packet of Italian talc with their medicated plasters to apply to the skin. To their surprise, customers started asking to buy the talc directly. J&J responded by creating a separate product called "Johnson's Toilet and Baby Powder". And as they say in the classics, the rest is history!

In the 1940's J Willard Marriott was running a successful group of restaurants, and was opening up new restaurants across the country following a strategy that clearly worked. But then a strange thing started to happen at his restaurant located at Hoover Airport (now Reagan National) in Washington DC. Their customers were not behaving in the same way as customers at other restaurants. Many of the customers at this airport restaurant were buying meals and snacks, and stuffing them into pockets, paper bags and carry on luggage - and taking the food onto the plane with them. Marriott was smart enough to recognise the opportunity and within a short time, had negotiated a deal with the airlines to supply pre-packaged food to passengers on the tarmac. This service soon grew to other airports and became a major business for Marriott Corporation.

Jim Collins and Jerry Porras write about companies that "Try a lot of stuff and keep what works" in their book "Built to Last". As J&J, Marriott and many other successful companies have shown, growth is not driven purely by good strategy. Bill Hewlett of HP stated that he "never planned more than two of three years out". Companies follow an evolutionary process that allows them to grow through learning from what works and what does not work for them.

But, how do you formalize this "evolutionary process" to ensure that you DO learn from your mistakes, and that you do not miss opportunities that may be off your strategy radar? The answer is through making innovation part of your business.

You make innovation part of your business by having the your ear to the ground! This means having the capability to capture business intelligence, and then to review that information that may be off your strategy radar to find those variations in your business that will lead to opportunities that you may not have thought of. The greatest source of this information is your people! How are you tapping into this wealth of information, ideas, and creative energy; and then translating this into your business plan? Are you staying fresh and ahead of the competition, or are you sticking to what you have done in the past? How do you know what works and what does not work in your business?

Imagine what Marriott Corporation would look like today, if they had ignored what was happening at that one restaurant at the Hoover Airport way back in the 1940s!

What makes a Visionary Company?

"The leader has to be practical and a realist, yet must talk the language of the visionary and the idealist." Eric Hoffer

What makes a visionary company? Vision statements, value statements, mission statements, purpose statements, aspiration statements, objective statements, etc. These are all fine and good, but they are not the essence of a visionary company. A "Vision Statement" (or something like it) in no way guarantees that it will become a visionary company!

In their book, "Built to Last - successful habits of visionary companies", Jim Collins and Jerry Porras say that the essence of a visionary company comes from something else. It comes from the translation of its core ideology and its own unique drive for progress into the very fabric of the organization - into goals, strategies, tactics, policies, processes, cultural practices, management behaviours, building layouts, pay systems, accounting systems, job design - into everything that a company does. A visionary company creates a total environment that envelops employees, bombarding them with signals so consistent and mutually reinforcing that it's virtually impossible to misunderstand the company's ideology and ambitions.

The central concept of alignment is what enables a visionary company to do this. Alignment means that all the elements of a company work together in concert within the context of the company's core ideology and the type of progress it aims to achive - its vision.

In his book "The Six Disciplines", Gary Harpst talks about aligning processes, policies, measures, technologies and people as part of achieving excellence in small businesses too. So, creating a vision is not simply an activity that you have to do as part of planning your business - hoping that this will somehow drive your strategy, tactics and day-to-day activities. The Vision Statement is just a small part in building an excllent company that will last.

RELATED ARTICLE:

• The Six Disciplines: Building Excellence in Small Businesses

Will your airplane fly?

Recently, on a flight from the USA to Europe, I enjoyed a meal while watching a movie. The ambient temp was around 72F. Very comfortable.

... And then I considered that less than a foot away from me, on the other side of the window, the temperature was -50F and the air was rushing past at 500 mph! I'm sure that I would not have been able to enjoy my dinner and movie in those conditions.

This Airbus 330 in which I was flying was designed to take people long distances at high altitudes. A single engine Piper Pawnee certainly would not have done this job. But then again, I would not expect the A330 to do a great job of crop-dusting!

The design of these aircraft had taken external factors into account.

How well do businesses take external factors into account?

When you consider that most small businesses do not survive 5 years, the environment in which they operate is as deadly for them as it is for a human outside a plane traveling at 500mph at a hieght of 36,000ft.

Many businesses look outside of their four walls with rose-colored glasses. Seeing the opportunities and planning how to exploit these. This is not a bad thing (in fact, it is essential). However, in our desire to see the positives we often miss the external threats to our survival and do not take the measures to counteract these.

External threats include competitive activity, changing market/consumer patterns, and advances in technology. Your people with valuable skills could also be lost to competitors. The business model that worked when you were operating out of your basement, will not work when you have 200 people working for you. How have you aligned your people, systems, technologies, processes and policies to adapt to these external factors?

How will you ensure that your plane does not break up when you climb to an altitude of 36,000 ft?

Organizational Restructuring

"Today's environment is beginning to threaten today's organizations, finding them seriously deficient in their nervous system design.... The degree of coordination, perception, rational adaptation, etc., which will appear in the next generation of human organizations will drive our present organizational forms, with their clumsy nervous systems, into extinction." -Douglas Engelbart, 1970

The observation that the American inventor, Douglas Engelbart, made in 1970 may shed some light on the cycle of restructuring that most companies find themselves in. In the many years that I have worked in companies, big and small, change has meant one thing for most of the time -> Organizational Restructuring.

How many of us have been in these situations? For many of us who have been long enough with the same company, we know that new management seem to feel like they need to “make their mark” by changing people around and restructuring the organization. Who has heard or repeated the comments: "Here it comes again!" or "Shifting the deck chairs on the Titanic again?"

In industrial design, experts know that "form follows function"; business schools teach "structure follow strategy". So why is it that some companies tend to be in a never ending cycle of restructuring? Is strategy changing that much? Are the fundamentals of the business changing so much that you need to change the organizational structure?

The top reasons why organizations change:

• Innovations in product, technology, materials, work processes, organizational structure, and organizational culture
• New and shifting markets
• Actions of global competitors, work force values, demands, and diversity
• Regulatory and ethical constraints from the environment
• Individual development and transition

These are all solid reasons for change. However, organizational restructuring in these situations should only follow after the BUSINESS STRATEGY has been changed - for the very same reasons. Very seldom have I seen an Organizational Change process that does enough due diligence around the strategy of change. Such a due diligence process is proposed below.

Getting to effective Organizational Restructuring.

1. Assess the impact of internal and external factors causing change on the business strategy.
2. Commit to a new business strategy to address the changes in market, technology, regulations, etc.
3. Assess as-is business processes to determine the impact of change on the organization. This will include the impact of process changes on existing roles. This will define the ‘gaps’ in existing roles which will make any structural changes effective.
4. Design/ align roles to support the changes in the business.
5. Develop and execute an organizational change management plan to address and define the drivers of any structural change, as well as the impact on the business of the change options.
6. Define performance metrics. Measure before and after the change to ensure that the change is effective.
7. Understand the cost of organizational change.