Could one question actually be the catalyst that helps you reinvent your business?
It would have to be a compelling question, to be sure. Well, over the course of my career in strategic and creative thinking, I’ve been involved in thousands of “thinking and idea sessions” trying to find the new idea, the breakthrough solution that will move a business from where it is to where it needs to go. And I continue to come back to this one test that forces people to think outside the box.
And for people in the print/graphic arts business, this can be a powerful tool, in a group setting, to spark a new level of conversation about how to adapt your business to today’s realities.
Here it is:
What would happen if you suspended all the underlying assumptions to your business?
Literally, this means you have to test all the “givens” in your business. So, rather than assuming that “this is the way it is”, you actually allow people to consider the very fundamental decisions that have driven your business to this point.
I was exposed to this approach at a symposium where I had the good fortune of hearing Peter Senge introduce the concept. He is s an American scientist and director of the Center for Organizational Learning at the MIT Sloan School of Management. He is also author of the breakthrough book The Fifth Discipline: The art and practice of the learning organization (new edition of 2007).
The whole purpose of this test is to free the mind of confining assumptions and mindsets, to give people a new canvas when envisioning a future state.
What are some examples of underlying assumptions in a classic print business?
Do I have to price on a cost plus basis?
This question seems silly, but the intent is serious. What if you rethought how you charge customers for the work you do? Now, there are surely hundreds of ways to price a job; but what if you deconstructed what the customer really values in the services he/she buys from you? You might find a pricing scheme that changes the game versus your competitors and presents your value proposition in a whole new way.
Today, it isn’t uncommon to see “internet printers” offering set prices based on turnaround time; if you want the job in two days, it is $1,000; three days, it will be $900. Wait five days and pay $750. Is the cost to do that job really different? No, but the value to the customer certainly is.
Do I need to own equipment to be successful in the business?
This is controversial. Many printers are personified by their equipment. “We’re a web shop.” “We’re a cut sheet shop.” “We’re a digital house.” But how much do customers really care about the equipment that the work is done on, as long as it is high quality and meets their requirements?
I had a conversation with a print salesman, who quit his job working for a printer with a wide range of in-house equipment and moved to a brokerage operation. His prices have come down to the point where he can be much more competitive on quotes. He has the trust of customers – they know he will get the job done right, with quality – so they are ecstatic that they can buy from him AND save money. Oh, and his commission has also doubled!
The moral? Is it possible that customers value your reputation enough that you could outsource your manufacturing…and potentially expand both your sales and your profits?
My point is not to tell you how you should change your business. I am simply asking you to go through an exercise to suspend all those givens that have gotten you to this point in the business. It is mind-opening…surprisingly revealing…and potentially liberating for you and your business.
When is it smart to actually let my sales figures go down instead of up?
Whenever an industry is confronting consolidation and heavy price competition, you have to ask: Can I really compete and grow, doing what I’m doing? Most everyone in the business goes through the analysis of which jobs were profitable and which were not. And the reasons are often the same.
The truth is, you have certain customers that turn to you over and over again. You may have certain types of business that you do exceedingly well. Is there a potential to narrow your focus…to specialize, with certain types of customers and work? Inevitably, you can find your way to more profitable sales. Sure, the top line goes down, at the start. But, if you are making more money and you can turn everyone’s attention to your new niche, then you can put your company on a whole new trajectory.
Some of the companies who have made the decision to focus (and taken a sales hit to do so), include Fetter Label (http://www.fetter.us/, who went from being a printer serving many industries, to a specialty company focused on the paint and coatings industry.
Then there is Action Envelope…now with the URL envelopes.com. They went from being an envelope printer to the trade, with 200 customers in the New York area, to being a nationwide provider with over 250,000 customers – generated by making the decision to specialize in web-based envelope sales.
So when you get your management team together to discuss the path your business needs to take, consider taking off the shackles…putting biases and assumptions aside…and letting the conversation take you places you never dreamed you’d go.