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Relationship tip: prevent problems
Wednesday, November 7th, 2007

The other day, John had a terrible negotiation. It went downhill from the instant he picked up the telephone. The customer was angry about how John had handled an issue. John was unprepared for the discussion. The customer started yelling at him, and John went on the defensive. The situation went from bad to worse.

What might John have done to avoid or deal with this issue?

For me, this is the cost justification for voice mail, caller ID, answering machines, and having people screen calls. These approaches yield results in two ways.

First, this approach reduces the risk that John will say something he regrets, or in anger. Once the words are spoken, it is very difficult to retract them. Often, if people have a built-in pause, they are less likely to say something they regret.

Second, this approach can provide John with enough information to prepare for the discussion. When John knows who is calling, he can (1) talk with his team about the account and see if there are known issues, (2) find out how the relationship is working from his team’s perspective, and (3) prepare for the discussion. In many cases, John may identify options or solutions that address the problems before returning the call. If John can do this, his value to all parties increases.

What other steps can John take to prevent or deal with the situation?

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Posted in Business Acumen, Business Trends, Negotiations, Planning Tips, Solving Problems | No Comments »



Family lodge is an example of geotourism
Saturday, July 21st, 2007

Growing up at my family’s fishing lodge, I had the ability to interact with customers.  We talked about many things - gardening, fishing, business, and substantive issues of the day.  It was networking person-to-person.

Places like my family’s lodge are rare.  It was built as a retirement home by my great-grandparents.  They had so many friends that wanted to get away from the city though that they had to turn it into a business.  It is extremely rural - surrounded by national forest and on a wild and scenic river.  Time stands still there in many ways.  Neighbors help each other.  Everyone knows everything about everyone else.  Masks disappear in such an environment.  Business and friendship intermingle.  I literally grew up at the lodge and customers were my mentors, teachers, suppliers, advisers, and friends.  To this day, that remains the case.  In some instances they also became neighbors, having decided that the area was extremely special.

People go to the lodge for a variety of reasons.  Some seek to fish.  The Rogue River has a reputation for being one of the finest fly fishing streams in the world.  Others want to walk.  There are several trails with varying degrees of maintenance and people can just walk on their own in many areas.  People enjoy seeing the gardens and eating fresh produce that was picked that day.  They enjoy watching wild animals in the animals’ habitats.  It is a heritage that many in the United States experienced, but many are generations removed from such a life style.  When they walk in the door at the lodge, customers are invited to make themselves at home.  Everything that we can reasonably do to accommodate the customer, is done.  Sometimes, customers have particular food preferences.  Just as those preferences would be accommodated in a family, we try to accommodate them.

Reading the newspaper this morning, I found out that there is a name for what we have been doing for roughly 70 years.  That name is geotourism.  With geotourism, the distinctiveness of the locale is emphasized and, as described above, both the tourist and the residents benefit.  That is what happened with my family business.  Customers got to step back in time.  I grew the knowledge that I needed and customers introduced a world of possibilities.  Even today, they do so.  National Geographic provided more information about geotourism.

If you are interested in staying a vacation at my family’s business, please let me know.  I am happy to talk with you about it. 

 

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Posted in About Coleen Davis, Business Trends, Customers | No Comments »



Negotiation Scenarios: Sprint Nextel fires customers
Tuesday, July 10th, 2007

Customers of Sprint Nextel that call too often are being fired by the company.

Are there any legitimate reasons that customers might be calling a supplier?  Think about why they might be calling Sprint Nextel.  At times, customers are legitimately concerned about bills, are receiving poor customer service, have questions, or need more information.  And, at times, customers may even be frustrated with the level of service they are receiving sch that they decide to call every day.  If a person wants to understand their telephone bill, maybe it takes a few calls to get there.  Look at a phone bill and see if you understand it.  Have you tried to read a phone bill recently and figure out what you are being billed for?  

Sure, 40 or 50 calls may be more than expected and it could be excessive.  Firing customers may be necessary.  Before firing customers though, it is a good idea to talk with the customers being fired and help them understand what they are doing that is causing problems.  Only through such communication can companies make good business decisions.  It seems though that, rather than talking with customers on a one-on-one basis, Sprint Nextel sent about 1,000 customers a notice about its decision.  Even though it waived the final bill and all early termination charges, firing customers like this has got to hurt its relationships with those individuals.

When customers are fired, even if it is done after exhausting all options, it can have a chilling effect on other customers.  Those other customers may be reluctant to raise issues.  Beyond that, the other customers may be offended by the approach and cancel their subscriptions on principle.  To the extent that relationships matter, firing customers damages relationships.  In this case, Sprint Nextel is already trailing AT&T and Verizon in the recruitment of new customers.  Can they afford to fire customers? 

What steps might Sprint Nextel have used, if it wished to retain customers and reduce its costs? 

Personally, I am wondering about changing its contract to indicate that the company was committed to keeping prices low and, as a result, if customers made an excessive number of calls, the firm would increase the prices to reflect the additional value that Sprint Nextel was providing to the customers.  What do you think about this approach?  Might it have lead to better results than losing customers is going to do? 

Another possibility could have been for Sprint Nextel to ask the customers to help it better meet their needs and paid more attention to the customers involved.  By doing so, Sprint Nextel might have ended up with a solution that led to good will, rather than egg on its face.

What other creative ideas might have been used?  How might you use Sprint Nextel’s situation as a learning point for your business?  After all, it is critical to learn from other firms so that we don’t repeat the same mistakes that they have made.

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Will manufacturers try to control minimum price?
Thursday, June 28th, 2007

Suppose that Mark Manufacturer produces a widget that Sam Supplier sells to Connie Customer.  Can Mark’s contract with Sam specify the minimum price that Sam will charge Connie?

Until today, few people in Mark’s situation were willing to do so.  Instead, people in Mark’s situation negotiated their price with Sam.  Then, Sam and Connie negotiated the price between themselves.     

As a result of the Supreme Court’s ruling in LEEGIN CREATIVE LEATHER PRODUCTS v. PSKS dba KAY’S KLOSET, Mark may be able to negotiate with Sam regarding the price that Sam will charge Connie.  A balancing test will be used to decide if the price that Mark and Sam negotiate and the use of provision itself is reasonable.  The Court said:

Factors relevant to the inquiry are the number of manufacturers using the practice, the restraint’s source, and a manufacturer’s market power….

The rule of reason is designed and used to eliminate anticompetitive transactions from the market.

It may be sometime before people in Mark’s situation engage in large scale negotiations over minimum prices.  Perhaps, it will be a situation where the restrictions occur in franchise and licensing situations.  In such situations, the manufacturer often exercises more control than in other types of business relationships.

What do you see as the future of pricing?  What will it mean for your business?  What will it mean for you as a consumer?

Is this part of a general trend in the US Supreme Court?  If so, what does this mean for you?

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Posted in Business Acumen, Business Trends, Customers, Negotiations, New Ideas | No Comments »



Impact of budget cuts on recognition
Friday, June 15th, 2007

Recognition programs are often one of the first items to be cut when budgets are reduced. 

The Oregon Scholar Program is a case in point.  The program gave certificates to the top 5% of students graduating from public high schools.  It didn’t even give scholarships. 

Look at the website though.  Oregon Scholar Program has been suspended due to budget cuts. 

How much money do you think that suspending this program saved?  What did it cost taxpayers, students, and business?

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Posted in Achieving Goals, Business Trends, Gifts & Recognition | No Comments »



Helping people learn to think for themselves
Monday, June 11th, 2007

One of the major challenges that business has is in finding employees who are willing to think for themselves.  Encouraging people to ask questions is one approach that helps people think for themselves.    

There are many downsides to having people think for themselves…

Questions make people uncomfortable.

People may feel like they are being put on the spot.

The ideas that arise may be unpopular or unconventional.

Rationale, cohesive arguments may be required of the people who wish to persuade others.

The 20-second sound bites, appeals to emotion, and blind adherence to instructions would be avoided.

People might have to admit that they are uncertain about the issues and they might have to listen to each other.

There could be conflict.

Despite those downsides, the upside potential is far greater.  In education, business, and government, people would have more value for they would actually be diverse in the ways that matter most:

Their ideas, opinions, thoughts, and approaches

Their motivations, goals, and definition of success

Fundamentally, this is the business case for diversity.  In the US, people from different backgrounds think differently.  In other countries, people often think the same way, regardless of their backgrounds.  

Is the idea of people thinking for themselves too scary?  If so, perhaps we should continue standardizing our approaches, requiring people to follow strict policies, and doing the thinking for others.  What do you think?

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Posted in Business Trends, Cultural Issues, Solving Problems | No Comments »



Nine Steps to Better Business Writing
Thursday, June 7th, 2007

Recently, Shelly contacted me because people were complaining about her writing.  They told Shelly that her writing was confusing and left a lot of gaps that they had to guess about.  Think of writing as the use of words to paint a picture or solve a puzzle.  What would you do in this situation?

Here is a list of tips that I shared with Shelly…

Tip 1.  Define the goal.  Why is the item being written? 

Tip 2.  Identify the reader.  For whom is the item being written?

Tip 3.  Understand the reader’s perspective and interests.  What matters to the reader?  Why should this issue matter to the reader?  Does the reader understand and care about the issue today?  Ask questions of the reader, where feasible.

Tip 4.  Think about the key points subpoints that the reader needs to understand.  Write them down!  How do they support the goal?

Tip 5.  Tie the points and subpoints together.  Build a path from the current situation to the situation that should exist, from the reader’s perspective.  The reader may not follow from beginning to end, especially not on the first exchange.  Still, the reader is a lot more likely to move closer to Shelly’s position if the document is written from the reader’s perspective than when it is written from Shelly’s position. 

Tip 6.  Challenge the points that have been made.  Think about the gaps in logic and fill them in.  Ask what the points mean for the reader.

Tip 7.  Keep it simple and focused. 

Tip 8.  Read and proofread.  If possible, set it aside for a day or two and then come back to the document.  When that approach is impractical, have someone else read the item and provide you with feedback.  If the person has a similar perspective to the reader, the feedback is likely to be even more helpful.

Tip 9.  Talk with the reader before sharing the document, if possible.  Validate assumptions about what matters.  Understand what the reader is trying to accomplish and why it matters to the reader.

Now, edit the document based on the additional information.  Then, share it with the reader.  

What other steps can Shelly and others take to be more effective in their business writing?

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Posted in Business Tips, Business Trends, Planning Tips, Tips for Students | No Comments »



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