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Profound knowledge for Lean Marketing
Posted by: | CommentsThis past Thanksgiving, I had the pleasure of reviewing the Four Days with Dr. Deming Videos for the first time. Not sure, I would recommend watching it. Deming is not Steve Jobs by any stretch of the imagination. However, he does end up growing on you and his dry sense of human becomes rather enjoyable after about the third video. At times when he says certain things, I am not sure he even knows why the audience laughs. I would recommend the book, Four Days with Dr. Deming: A Strategy for Modern Methods of Management
In my quest to assist in bringing Lean to sales and marketing, I find some very basic questions that Dr. Deming used to warn us about the upcoming crisis quite interesting. He says we have been living on the wealth from natural resources and simply warned that it could not continue. An excerpt from the book,
Without a change we will not make it. We need to look at new ways to understand our system. If we understand the theory of variation we know that it is futile to ask for something outside the system’s capability.
One of my friends is the Chief Executive Officer of a small company. The performance of the Chicago Region was poor. For three years running this region produced only 7.5 million dollars of sales per year. My friend needed 10 million dollars to make keeping the office open a viable matter. “A fact of life.” as Dr. Deming says. The chart showed a steady state, flat sales. From what I learned today, sales is a system. If the system is stable, then man-
agers must apply leadership to change to a new level of performance. For the past three years my friend simply raised the sales quotas and gave pep talks. He must make a basic change. I am beginning to catch on to the theory of variation and psychology.How true Deming was when you apply his thoughts to sales and marketing. Our natural resource was that demand always exceeded supply. Sure, it was not handed to us on a silver platter and not all of us were successful. But for the most part, there was a demand. That demands has diminished or cease to exist in many markets. We are competing in a state where there is excess supply. There is a scarcity of sales and marketing’s natural resource, customers!
How many companies are still giving pep talks? How many companies still do not understand sales and marketing as a stable system? You can tamper and cause special cause variation (yesterday’s post as an example: Lean Marketing: Sales Quotas lead to Waste) but the bottom line is that sales and marketing has changed and that it must be managed as a system in the future.
Most serious practitioners that understand sales and marketing as a process have begun to emphasize three core principles in their teachings:
- Continuous improvement of sales and marketing is a necessity
- Metrics are required to judge the rate and degree of improvement
- A sales and marketing process is needed for determining metrics
There are many marketing “systems” in the world. When you think about a system it is just a series of functions or activities within an organization that work together for the aim or the organization. However, most of them have relatively little value towards improvement or optimization as a whole. Dr. Deming’s system of profound knowledge offers the best way for sales and marketing to succeed in the future.
Deming believes that the journey continuous improvement requires the understanding of systems which is emphasized in his own system of Profound Knowledge. Profound Knowledge is made up of four interrelated components:
- Appreciation of a system
- Theory of knowledge
- The psychology of change
- Knowledge about variation
This is fundamentally Lean thinking.
Related Posts:
Apply Lean thinking to Sales and Marketing
Starting with Lean A3 Thinking in Marketing
The Perfect Storm has come together of Excess Capacity and Product Variety
The 7 step Lean Process of Marketing to Toyota
Best Marketing Advice Ever, yes Ever!
Lean Marketing is a Problem Centric Discipline
The Lean Edge and Zen – 2 great topics discovered
Posted by: | CommentsThis is a nifty project management tool based on Kanban principles that Jim Benson of Personal Kanban told me about during the recording of our podcast. .
What is Zen?
Zen is a simple and flexible application that draws on ideas from lean manufacturing to provide a new way of thinking about project management. Rather than organizing tasks into a bunch of lists and trying to slice and dice your way through it, Zen lets you see and interact with your work visually.
Zen draws on an idea from lean manufacturing called kanban — a Japanese word that literally means visual card. In a Zen project, work is organized on a kanban board, which has a number of columns that represent the phases that work has to go through in order to be considered complete.
Review their site at agilezen.com
The Lean Edge
This is a Question and Answer site branded as a dialogue between management thinkers and lean authors.
Lean management is a method to dramatically improve business performance by teaching people how to improve their own processes. The two main dimensions of lean management are continuous process improvement (going and seeing problems at the source, challenging operations and improving step by step) and respect for people (developing and engaging employees by developing teamwork, problem solving and respect for customers, employees and all other partners).
The Lean EDGE is a platform for discussion between management thinkers and lean management writers. Lean authors give their responses to general management questions posed by guest writers. The aim of the discussion is to share different points of view and to collectively build a vision of lean management.
Founding members are:
- Art Smalley
- Daniel T. Jones
- H. Thomas Johnson
- Jeff Liker
- Michael Ballé
- Mike Rother
- Orest Fiume
- Robert Austin
- Sandrine Olivencia
- Steven Spear
- Tom Ehrenfeld
Great resource and a great opportunity to ask some of the leading thinkers a question.
Is your customer willing to pay for your marketing?
Posted by: | CommentsHow do you add value in your marketing? Have you thought about it? To be effective in Content or Educational Marketing you must add value as defined by the customer. I want you to steer away from your first thought, which is more than likely your product or service, but instead think about your marketing material. For your Content marketing material to be effective, I believe it must have 4 components:
Value Added: Your marketing needs to add additional knowledge or be a reinforcer of your product or service to your customer. A blog or commenting on LinkedIn are several online examples. It can be done in traditional advertising and marketing. Using a 2-step advertising strategy and offer something of value versus trying to coerce them into buying a product. Especially consider your marketing message in each step of your marketing process or value stream. I believe that if you are effectively using the Pillars of Lean Marketing House properly that you need to increase the value of your offering as you walk someone through the process. You must also segment your list during the process so that the perceived value is also recognized.
Quality: If you look at marketing in today’s world, I believe authenticity is sometimes more important than a professional full color ad in your trade magazine. People want to become connected, just review some of the YouTube videos of BlendTec and the Will it Blend series. Variability is the lager culprit of quality. It goes without saying, your marketing should be professionally looking, but I believe the biggest problems with quality is variability. It confuses the message to your customer. When you dilute your marketing message not only by confusing advertising but sometimes being in the wrong place, even with the wrong customer, can send mixed messages to your target market.
Time: Delivering your message when a customer needs it, is imperative. Before or after the proper time reduces the value tremendously. Few customers will put it in a file and save it for when they need it. We are simple on information overload – ALL THE TIME. The timeliness of your message is important to understand. You seldom can do this without understanding your customers buying cycle and the needs they have during that cycle.
Cost: This is a little of a 2-way street here. One you must consider your own cost and the ROI on doing the particular piece. You have to determine if a Super bowl Ad is worth it. However, when I consider the marketing piece I am going to employ, I like to think of it in a different way. Is the content something that the customer would pay for? If this does not raise the bar on your marketing, you are doing a lot of things correct. If you had a free whitepaper to download, why not sell it on Amazon for $2.00. Is is worth it? Is not relinquishing my e-mail address and giving you permission to market to me worth $2.00. Look at your marketing material and put a value to it! Better yet, ask your customer if there is a value to it?
Would it be great if your customer was willing to pay for your marketing?
Related Information:
Lean Marketing House Overview – Video
Identify your Marketing Constraint
Posted by: | CommentsAs I mention in a previous post: Every System, typically has relatively few constraints. However, to operate at maximum efficiency, the limiting constraint must be identified. Five Steps of Continuous Improvement help identify and improve the constraint. How do I correlate the Marketing Hourglass with the Theory of Constraints? TOC uses the weakest link, a chain as a visual in working with throughput.
Below, I have outlined my basic understanding of the Theory of Constraints from my readings and experience. If you would like to dive deeper into this subject start with the AGI-Goldratt Institute website and there is whole slew of books, trained consultants(Jonas) available throughout the country. I believe the Theory of Constraints principles are a requisite for continuous improvement.
Before starting with the 5-steps, there are two prerequisites:
1.Identify the Goal of the System /Organization
2.Establish a way to measure the progress
The most common goal is to make money and that should be our overall purpose. It sometimes can be overlooked in increasing sales, client retention and many other factors. Many will argue but increase sales can hide many problems. The companies that fail the quickest in a recession are the ones that were living on growth without really generating income.
There are several ways to measure progress with the most common being Throughput, Operating Expenses and ROI. Going into too much detail about how to use the ratios is beyond the scope of this blog. The important thing to remember is that TOC methodology values Throughput and it as the best means to fuel growth. TOC then looks at Inventory(Prospects) second and operating expenses third. So our concentration will be optimizing the Throughput of the Marketing Hourglass utilizing the Five Steps of Continuous Improvement :
Step 1. Identify the system’s constraint.
Step 2. Exploit the system’s constraint.
Step 3. Subordinate everything else to the above decision.
Step 4. Elevate the system’s constraint.
Step 5. If a constraint is broken (that is, relieved or improved), go back to Step 1. However, don’t allow inertia to become a constraint.
Starting at the beginning:
Step 1. Identify the system’s constraint.
The system’s constraint is the phase or part of the phase that resource which limits the output of the entire system. Start following your actions and you may find out that your bottleneck is not just getting more prospects in the door. If you can monitor actual numbers, you may be amazed at what is happening to your prospects(inventory). This is where we need to identify the constraint , where is your constraint?
The easiest way in a manufacturing analysis is to walk around and see where the work is piled up. It is not that much different in a marketing process. Walk around and see if there is a pile of sale presentations waiting to go out. You may find people waiting on financing to be approved. Maybe, inconsistent delivery of Newsletters and so forth.
If you have done a good job of building your marketing hourglass, you may be surprised on how easy it is to find. You may be so lucky to be able to eliminate parts of a step, not the entire step. Start internally, as you gain internal control you will also gain the respect of your customers and vendors. This may help you significantly when you ask them to assist you in later improvement needs.
Our Next blog will continue with step 2 and 3.
Related Blog Posts:
Using the Theory of Constraints in Marketing
Using your Marketing HourGlass to determine your Constraint
