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Dec 1, 2005 12:00 AM
The extensive research our organization conducted during the economic difficulties a few years ago (“Lessons Learned,” published by PIA/GATF) indicated a growing polarization in our industry in terms of performance. Over time, financial performance is a reflection of an organization’s mindset and behavior. At the risk of oversimplification, the study revealed that it is misleading to talk in terms of industry trends and ratios. I know of no company that has been successful by following the pack. In today’s graphic arts industry, there’s no pack to follow.
This is frustrating to risk-aversive owners and managers who assume there are all-purpose answers. It’s a 21st century version of “The Holy Grail”: The solution is out there if we can just find it.
Dare to be different
Not enough owners and managers understand that it is impossible to manage performance. Instead, management and leadership means helping the organization to recognize and create the conditions that lead to creation of unique perceived buyer value. That, in turn, leads to improved organizational performance. Call this Point B. It’s foolhardy to believe that it is possible to go from Point A to Point C in improved sales performance without addressing Point B, the creation and communication of unique customer benefits.
The needs of the marketplace are not uniform or universal. Every hotel, gas station, airline and supermarket also searches for meaningful differentiation. Thus, homogeneity in vertical markets is crumbling.
Traditional business practices and concepts are being turned on their head. Forget the notion that a printing company should first determine its core competencies, then seek buying organizations that will buy its products. Today, it’s l80 degrees different: Go to lengths to determine the needs—not necessarily the wants—of a targeted marketplace, then develop competencies that uniquely meet the needs of those buying organizations.
To the credit of thousands of print companies, this is the path they’ve followed in offering distribution services. Few companies bought database management software, mailing equipment and storage racks on speculation. Instead, materials and expertise were developed or acquired in response to the needs of one or more accounts.
The proverbial train is pulling out of the station for printing companies that adhere to the operating philosophy that salespeople are paid to “sell what we do best.” Those companies inevitably find themselves competing in a pool with fewer fish to be caught. A buying organization is taken out of play by a competitor offering tailored, customized services accompanied by online, real-time systems that ensure the customer will not lose control of the process.
The train might already have left the station for printing companies operating on the theory that extraordinary pricing and commitments should be made to reel in a new customer; after that, there’s an opportunity to create nonproduct value. In fact, the opposite is now true. Low-balling, then raising prices over time, fools no one. It’s resented by many customers and erodes trust over time.
New account development no longer requires tactics to secure that first job. It is to create the trust and conditions that lead a customer to want to buy from your company. The days are long gone when trust could be created through the first job for a new account; today, trust must be established before the first job is awarded.
It’s just a grail-shaped beacon
Too many companies in our industry have planned, either formally or informally, by trying to sell their resources and competencies, then identify vertical business markets that are prime prospects for their products and services. That process is becoming less valid as companies within those vertical markets strive to differentiate themselves from other competitors.
“The Holy Grail” lacked validity in the 11th century and remains invalid today. Research the marketplace, then turn inward, rather than organizing and broadcasting your organization’s products and services. Beware of industry snake oil salesmen who try to convince you that there are all-purpose, off-the-shelf solutions to a print company’s business challenges.
Develop and cultivate a mindset that, in non-technological areas, there are no guarantees, no pat answers, and the experiences of others are to be discriminately studied. National norms, if followed, lead to average, not superior, performance. The objective is not to be the best of the best. The objective is to offer unique, valued benefits to a select group of customers.
Dick Gorelick is president of Gorelick & Associates and the Graphic Arts Sales Foundation. He can be reached at email@example.com.