What does it take to develop followership – check out this video

I have lost count of how many hotels and conference centers I’ve encountered over the years who define their strategy as ”delivering great customer experiences” or being ”among the top 5 in their category or region”.

But that’s not a strategy. At best it’s a vision and and worst-case it’s just wishful thinking

Strategy is distinctly different from visions missions and goals. Strategy crystallizes the very hard choices that we all need to make. Strategy defines how we create value. Value emerges when we have the skills to produce something that costs us less to produce than somebody else is willing to pay for it. Period.

Value = ( Sales Price – Cots to produce/deliver)

At first, that sounds simple – but it quickly gets trickier, what I may be happy to pay € 100 for is probably quite different from what you are happy to pay €100 for. Value is deeply subjective, each of us computes it in our own way depending on the circumstances and the situation.

It therefore makes no sense to talk about creating value without at the same time answering the question value for whom?

Because if I try to be everything to everybody I risk ending up being nothing to anybody and there’s not much value in that.

Where to Play
Developing an effective strategy therefore boils down to defining target market segments and clearly understanding what it is they need. (But but when targeting certain segments we also need to understand that that means there are other segments that we are willing to forgo)

How to Win
The better we understand the specifics of a segment the better we can tailor our service delivery in such a way that we produce value for exactly that segment.

So the 3 hard questions we need to ask our selves are:
1. Who is the target customer?
2. What is the value proposition to that customer?
3. What are the essential capabilities needed to deliver that value proposition?

Obviously, if we are running a hospitality business that is open 365 days a year we will need to identify several target segments ( time of year, day of the week – day part etc). Remembering, that what differentiates segments is not the demographics but the situation.
I have very different needs when I’m traveling in connection with a weekend break, compared to when I am traveling to conduct a workshop – same fellow very different needs ( and price points).

So we need to break down our value propositions into situations.

In my book Best! . No need to be cheap if you are … I have a chapter on how to work on you value proposition using the value equation.

Also here is a great article from S+B on the same subject – and finally the best tool to visualize and brainstorm some more on this is the Business Model Canvas as explained in the video here.

This is the core idea of my new book.

So why write another book you might ask – it’s not as if the world is craving for more books on service, customer focus or management?
Surely there is also an abundance of books?

Well – Yes… But on the other hand… No!

Let me explain.

My work in the service industry has been based on the principles outlined in a book that caught my attention in 1990 called The Service Profit Chain – shortly after the book was published I became the CEO of a large hospitality group and the principles outlined in the book became the basic foundation for the approach that we took. It worked like a dream for us.
In fact it worked so well that in 2001 I decided to form a consulting and training company that would help others implement the principles of the Service Profit Chain.
So for the past 10 years or so I have been delivering workshops, training, and keynote speaking to companies in the service industry from consulting engineers to managers in large hospitality groups.

I nearly always get asked at some point: ”Where can we read more about this? ”

And I refer people back to the original work published by Harvard in 1989.
But when I then check back later and ask if they enjoyed the book I very often get slightly sheepish looks and some mumbled excuses about not really getting past the first chapter.

I suspect this has to do with the fact that a lot of the people working in the service industry prefer a very practical hands-on approach to their learning. The original service profit chain book is a fabulous piece of work but it is in parts quite theoretical and with more than 360 pages to get through it is also quite a mouthful when you have a lot of other stuff on your plate.

Invariably the discussion therefore leads the obvious question from my client: Why don’t you write an easy to read, simple to understand hands-on guide to implementing the service profit chain – we really need that!

And funnily enough when I then researched what’s already published I can’t find anything that integrates all seven steps of The Service Profit Chain into one coherent system that is easily understandable at all levels of the organisation.

So there was nothing els for it but do it my self – and here is is:
Best! No need to be cheap if you are…

“The new thing is never as good as the old thing, at least right now.
Soon, the new thing will be better than the old thing will be. But if you wait until then, it’s going to be too late. Feel free to wax nostalgic about the old thing, but don’t fool yourself into believing it’s going to be here forever. It won’t.”

If you don’t understand this you will have a “KODAK – Moment” and wake up one morning and find that the new thing that was not nearly as good as your old thing has now stolen your business.

The coaching gurus all seem to agree. To reach your goal you need to declare it and abracadabra you are already halfway there.

Well, it turns out that they could be wrong.

According to research performed by a group of American scientists last year and document by Daniel Pink there is a significant difference in performance between 2 groups performing the same task and where one group uses what the scientists called declarative self talk ( I can do it) and the other group uses interrogative self talk (Can I do it?).
The self questioning group performs a lot better than the self affirming group.

In Denmark we had an interesting example of this recently.
As the Danish handball team departed for the European Championships they self confidently declared that they were going for gold. They subsequently lost their first few games and in no way looked as if they were going to get anywhere near the finals. The fans at home of course were furious and the players and trainer were all accused of hubris. Subsequently the declarations from the trainer and players took a subtle shift from ”we can do it” to some serious self questioning around ”can we do it?” and ”what would it take to do it?” – and – abracadabra, they brought home the gold medals to everybody’s surprise – including their own I guess.

The research seems to indicate that people who ask questions somehow come from a more humble place and that in turn creates a space to come up with a deeper solution.

For those of us who have been working with action learning for years that does not come as a big surprise….

Inspired by the principles developed in the “Service Profit Chain”, Mike Hohnen takes you through each of the steps needed to create an outstanding service business.

You will find it here on Amazon

Best!

We live in a world of abundance – there is plenty of choice everywhere. And since 2008 we have experienced significant drops in demand as consumers became more careful. The result is a widening gap between supply and demand in virtually any category you can imagine.
When that happens, many companies have a knee-jerk reaction, and the recipe is more or less always the same: initiate rigorous cost-cutting programs, reduce staff and/or services, offer discounts in many forms, and increase advertising aggressively.
This, however, is the equivalent of trying to steer and brake as your car begins to skid on black ice while going through a sharp curve.
As you hit that declining demand curve, you need to perform what at first seems like a counterintuitive move: hold your price, increase your services, improve your quality, and narrow your focus in the market.
In this book, you will not only understand why but also see how you can do that.

One that struck me in particular was the story of when Jobs returned to Apple after his years of involuntary exile. At that point in time Apple was on the ropes and the market was rapidly losing faith.

Jobs convened a product review meeting – Apple at that time had 10–15 different versions of the Mac on the market and even more in the pipeline. Jobs went to the whiteboard and drew a 2 x 2 matrix. On the one side he wrote home/professional on the other he wrote desktop/laptop. Jobs then announced: That is it – four products. A laptop for professional or home use and a desktop for professional or home use. Everything else is as from now abandoned/discontinued.

The lesson for us all of course is: focus. Decide what it is you want to do and do it well.

Trying to be all things to all people invariably results in being nothing to anybody.

We don’t yet know what is next – but we do know it will be different. One thing you can be sure of is that in the next 5 years you will see more innovation than you have experienced the past 15 years – what will that mean for your business?

We wrapped up the 3 days with a ProActionCafe – a great new tool that we learned at our Art of Hosting training in Aarhus in August. The cafe combines the best of World Cafe, Open Space Technology and Action Learning.

Four students hosted 4 workshop on developing the focus for their action learning question – the question they will work on for the next 16 weeks and that will form the basis of their final written assignment in December. The Proaction Cafe was hosted by Kathrine Procter who is the Program Manager on this module and works with structured questioning in three rounds. Each round has 3 new expert help the host develop depth, perspective and action items on the chosen question.

The feed back afterwards was awesome – not only did the 4 hosts declare that for the first time did they have a clear focus on their assignment at a very early stage but the other participants also felt that they had learned a lot about how they could approach their learning question.

An unexpected bonus that we had not thought of was that participants felt that working in the ProAction Cafe format also gave them a great opportunity to recapitulate the learning from the three previous days as they wove these topics into the problem solving discussion at the tables. It does not get much better in my world.

Powerful stuff – that we will develop further.